Grant Thornton is now the biggest accounting firm to get private-equity backing
Grant Thornton became the largest accounting firm to sell a piece of itself to a private-equity investor on Friday, giving it more financial firepower to make acquisitions and investments—and, potentially, a new client in its owners. The firm’s Chicago-based U.S. unit closed the sale of a stake to a group led by to New Mountain Capital on Friday, following an agreement in March.
Under the deal, the U.S. audit business will remain a partnership, while U.S. advisory, tax and other non-audit services will be part of Grant Thornton Advisors LLC, a newly created limited liability company.
The New Mountain-led group’s investment constitutes a 60% stake in Grant Thornton’s U.S. unit and centered on the non-audit business, people familiar with the matter said. But the new majority owners will also have a contractual relationship with the audit business through a management services agreement between the two entities, the people said.
The sale will allow the firm to grow through acquisitions and investments in tech and personnel, likely at a faster pace and with less risk than it otherwise would have, said Seth Siegel, Grant Thornton’s U.S. chief executive. The firm aspires to be a more attractive acquirer of companies as it looks to expand its share among middle-market corporate clients, typically ranging from $100 million to $10 billion in annual revenue, he said.
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