Accounting firm RSM US in talks for merger with UK arm

RSM US is reported to be in talks to merge with its UK arm, which if given a green light, would be the first major transatlantic combination in the accountancy sector.

Both firms target the mid-market and this deal would allow them to better serve clients with international operations.

RSM UK has been through several re-brands and name changes, including rebranding as RSM in 2015. It now has 350 partners across the UK, were provided details on Thursday about the talks about the potential merger with is US sister.

The UK arm’s most recent results revealed it had revenues of £543m in the year to March, a 12 per cent increase on the previous year, while the US arm reported revenue of $4bn (£2.8bn) in the year to April, up 8 per cent.

The merger would span across the US, UK, Canada, Ireland, India and El Salvador, with 23,000 professionals and a combined annual revenues of $5bn (£3.8bn).

Chief executive of RSM UK Rob Donaldson said, “it’s very much a merger” adding that “there is no money changing hands. It’s not about generating cost synergies, though there may be some of that. It’s about generating faster growth.”

While Brian Becker, chief executive of RSM US explained the UK arm has capabilities in capital markets consulting where the US firm was less strong, noting the UK is the largest destination for foreign direct investment from the US.

“We’re not trying to be the ‘Big Five’, we’re trying to be the ‘Big One’ to really dominate the middle market,” he told the Financial Times.

Both firm’s are members of RSM International, a network that spans more than 120 countries, over 800 offices and more than 64,000 people, with global revenues of $9.4bn (£7.4bn).

These talks come on the back of rival Grant Thornton back in July was reportedly considering selling a stake in its business to private equity.