Four months after putting its pensions advisory wing up for sale, KPMG has entered exclusive deal talks with Exponent Private Equity.
KPMG’s pensions consulting division employs about 20 partners and 450 people and works for some of UK’s largest pension companies, holding around £50 billion of pension assets under advice. Following regulatory pressure on the Big Four to invest heavily in their Audit divisions, KPMG’s UK chairman, Bill Michael, has been vocal in his desire to see the firm reform its footprint.
The professional services firm has in recent months invested £45 million into its Audit arm in order to beef up quality, following revelations that KPMG carried out deeply flawed audits at a number of clients in the UK. Meanwhile, the firm has decided to stop all non-audit work for audit clients last year, with the two decisions the main drivers behind the firm’s decision to sell its pensions unit.
Following discussions with a number of interested parties, including Lane Clark & Peacock and Duff & Phelps, KPMG has now agreed exclusive merger & acquisition talks with Exponent Private Equity, an investor that has previously backed companies such as vegetarian food producer Quorn and Loch Lomond Distillery. The private equity group currently owns stakes in discount website Wowcher, daily newspaper The Racing Post, and sightseeing organiser Big Bus Tours, among others.
According to Sky News, which broke the news, the deal is mooted to be in excess of £200 million. Commenting on the development, a spokesperson for KPMG UK said: “Following significant interest in our market-leading pensions practice, we can confirm we have entered into exclusive talks with Exponent with a view to progressing a sale. We will not comment further while negotiations remain ongoing.”