Gavin Hinks, Accountancy Age, Thursday 22 July 2010 at 10:45:00

Firms will come together through more traditional means


The Vantis model of consolidation is unlikely to appear again, according toindustry watchers who believe activity among firms will take a more traditionform with the merger model being the most likely route to bringing businessestogether.

The views come from UK200 Group president Colin Howe who believes that therecent demise of Vantis has provided a salutary lesson about thr risks involvedin raising growth capital through the publicly quoted markets.

"I suspect most of us in the independent accountancy firms sector will havereceived the news with a hint of 'schadenfreude'. the demise of a competitorbrings opportunities, but this is coupled with sympathy for all those directlyaffected."

He added: "There will undoubtedly be further consolidation in the mid-tiersector but I believe that this will follow the more traditional 'merger' model(undertaken for defensive and succession reasons) rather than cash buyouts wherethe returns on investment are proving elusive."

Vantis collapsed earlier this and was sold piecemeal. Former partners boughtpart of the firm while RSM Tenon bought another.

The business had faced a going concern warning and had suffered because itwas unable to recover fees for working on the liquidation of StandfordInternational Bank.

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