BrazilDubai's Delta Partners on the verge of joining FTI Consulting
Global advisory FTI Consulting is reportedly weighing a decision on acquiring Dubai-based TMT consultancy Delta Partners, which has an international headcount of over 200.
Global advisory FTI Consulting is said be considering a sale offer from Dubai-headquartered consultancy and TMT-sector specialist Delta Partners, according to a report published by Bloomberg. Citing one or two unnamed sources, the report notes that Delta has for several years been on the hunt for a strategic partner to aid its growth ambitions, while FTI would be able to enhance its service offerings to telecom and technology clients through the acquisition.
As well as concentrating on the TMT sector, Delta is also a functional specialist, with a focus on strategy and management consulting and corporate finance & investment banking. Earlier this year, the 2006-founded firm expanded to the Australia and NZ market through the launch of a Sydney office, adding to existing overseas locales in Barcelona, Singapore, San Francisco, New York and Johannesburg. Meanwhile, FTI Consulting has been going gangbusters.
Last year, the firm recorded revenues of $2.35 billion, up by 17 percent at constant rates. Highlighting the extent of FTI’s ascension, at the beginning of 2018 revenues stood at $1.8 billion, with the firm effectively tripling its market cap since a low point in the middle of 2017. Much of that growth has been organic with a focus on the recruitment of high-level talent, the firm’s purchase of German restructuring counterpart Andersch last year being the largest recent acquisition.
However, a final decision on any take-over of Delta Partners has yet to have been made, Bloomberg’s sources cautioned (the publication later highlighting that FTI shares were up by nearly 10 percent on Monday), and there's still no guarantee that a deal will get over the line. According to the report, Delta is pushing for an arrangement which would maintain strategic decision-making rights for its current management, including presumably co-founder and chief executive Victor Font.
Representatives for Delta Partners and FTI Consulting declined to comment on the proposed deal, but it’s of note that discussions have been reportedly underway since before the outbreak of the global coronavirus pandemic, which may have some bearing on the final outcome. One early analysis has suggested the global consulting industry is facing a $30 billion hit to revenues due to the crisis, or a nearly 20 percent contraction in 2020, with a string of acquisitions likely on the cards.
Although it has also been suggested the world’s largest consulting firms with typically diverse portfolios will be the best placed to weather the storm, both FTI and Delta may be reasonably well insulated; Delta in that it has a line in finance and M&A and transactional services, with the TMT sector not among those projected to bare the very worst of the brunt, and FTI courtesy of having grown into one of the world’s foremost restructuring advisors.
