Canadian Grant Thornton, BDO units discuss merger
NEW YORK, April 13 (Reuters) - Grant Thornton LLP and BDO Dunwoody LLP, Canada's No. 5 and No. 6 accounting firms, said on Friday they have agreed to discuss a merger as they seek to become more competitive with the top four firms.
"A combined firm would have enhanced strength, capacity, depth and market credibility to compete in marketplaces across Canada, while at the same time maintaining a strong position in the local communities throughout Canada," Gilles Chaput, chief executive of BDO Dunwoody, said in a statement.
Four firms -- Deloitte & Touche [DLTE.UL], Ernst & Young [ERNY.UL], KPMG [KPMG.UL] and PricewaterhouseCoopers [PWC.UL] -- audit the overwhelming majority of large public companies in the world and are the top four auditors in Canada as well.
An accounting industry expert said, however, the two firms may face a culture clash if they merge.
"GT (Grant Thornton) is attempting to join the Big 4 market, while BDO, outside of Toronto and a couple of other large cities, mostly operates in small towns," Arthur Bowman, editor of the Bowman's Accounting Report newsletter, wrote in his latest issue on Friday. "The possible culture clash may outweigh benefits of merging."
Grant Thornton has 2,900 employees in Canada in 99 offices, while BDO has 1,900 employees in 95 offices across Canada.
The potential merger would occur only in Canada as accounting firms typically operate independently in individual countries. The firms are both presently members of the Grant Thornton International and BDO International networks. (Reporting by Emily Chasan; Reuters Messaging: rm://emily.chasan.reuters.com@reuters.net;Tel: +1 646 223 6114; editing by Jane Baird))
