Deloitte has set up a corporate finance venture that will
combine the expertise of the network’s UK and Middle East firms.
The new company, Deloitte Corporate Finance Limited, is registered
and authorised by the Dubai Financial Services Authority.
It will initially focus on offering M&A advisory and support
services, valuation, business modelling, IPO advisory, forensic and
dispute services, and Islamic finance advice.
Deloitte UK will relocate several partners to the venture within
the next few months. They will join a partner from the existing
Middle East firm.
Chris Ward, Deloitte’s global head of corporate finance
advisory, told the International Accounting Bulletin that
the current Deloitte Middle East corporate finance practice of 45
staff will be rapidly expanded to meet client demand.
“They are doing well, they are growing fast, but it’s not of a
scale which is able to meet the needs of the marketplace,” Ward
said. “The UK initiative, the joint venture which is being funded
by the UK, is designed to help the Middle East firm grow its
corporate finance business faster than it would do on its own.
Within a couple of months we will have transferred seven partners
into the business, so there will be eight partners and a total
complement of about 80 that we’re planning to grow to about 120
people by the end of May next year.”
Ward said the venture will try to recruit talent locally where
possible. He estimates, however, that 20 to 30 professionals will
need to be seconded from Deloitte firms across the global
network.
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By GlobalDataProfits from the joint venture will be split 50/50 between
Deloitte UK and Deloitte Middle East partners. Ward said Deloitte
UK already has a strong working relationship with the Middle East
firm.
The UK firm also runs the largest corporate finance practice in
the Deloitte network, making it an obvious choice for the new
venture. He said that separate joint venture arrangements have been
set up between Deloitte UK and Deloitte India, and several UK
partners work in Deloitte’s Chinese firm, helping establish its
corporate finance arm.
“We adopt a number of different strategies depending on the
circumstances of the country. It’s about supporting our smaller
growing practices to make sure they’ve got the skill set, the right
people and the scale to support our clients,” he said.
Deloitte Middle East chairman Omar Fahoum said the private
equity industry in the Middle East is expected to exceed $670
billion in the next ten years.
“Strong fundamentals, rapid growth and greater availability of
funding means that deals are set to grow in size from millions to
billions,” he said. “By combining our expertise and talent we will
be able to ensure that we are at the forefront of this market.”
The International Accounting Bulletin understands that
the Big Four and a handful of large mid-tier firms have dedicated
corporate finance practices. Although Ernst & Young is the
largest professional services firm in the region, Ward believes
Deloitte’s current corporate finance practice is of a comparable
size.
“Once we’ve got the joint venture fully up and running we will
probably be the biggest dedicated corporate finance business,” he
added. “What we are setting up is a full service corporate finance
business, covering a whole range of things you would expect such as
M&A advisory, the due diligence capability, evaluations,
Islamic finance, and M&A tax all under the one roof. So in
terms of looking at the competition in that context, I think we
will undoubtedly have a broader range of capability and services
than any other firm.”
