Will Bain & Co be bought out by a bigger consulting firm?
I've been hearing chatter from highly placed people in the Consulting Industry that AT Kearney (first) and Bain & Co (second) do not have scale to survive on their own and might be bought out by a bigger consulting firm (Accenture?).
This follows the acquisitions of Monitor, Booz and Parthenon.
Do you think ATK/Bain will survice on their own? I am going to guess that these 2 firms will be bought out by a bigger rival soon.
On the other hand McKinsey and BCG have have increased the scale and scope of their offerings and moved downmarket to offer services like McK Implementation to survice.
What do you guys think?
I think ATK definitely gets bought out in the near-term. Bain doesn't have any immediate risks, but if there's a moderate level recession they are in trouble. Bain is heavily indexed in cyclical industries (e.g. PE DD, Airlines, etc) and has hired a lot of people since 2008.
From my limited knowledge of Economic cycles, isn't another recession bound to happen?
Would you feel comfortable going to Bain knowing that the survival of the firm depended on the business cycle - as opposed to Mck/BCG who would get work regardless of what end of the business cycle you are in.
NA
McK and BCG struggled during the recession too. All companies tighten their discretionary spend budgets during recessionary periods. Bain might be slightly more vulnerable as it does sell more PE DD work, but the firm obviously survived 2008 and is doing fine.
I keep seeing this rumor popping up on these forums from time to time, and I have yet to see a logical argument for why it makes sense for Bain to sell. Even in the early stages of this thread, I see conflicting arguments with one guy saying Bain doesn't have the scale to survive and another guy saying Bain's been hiring too fast. Well which is it?
ATK in Korea was bought out by a local sweatshop that also bought Accenture Korea.
The ATK brand still remains (ACN Korea's Strategy Division closed shop) and perhaps the global network (with a price), but from what I hear they're expanding their Operations branch and are massively cutting project fees to entertain wider client bases/practices.
FWIW I heard from higher-ups at Bain that they're growing rapidly and have no plans to be acquired anytime soon. But those are some interesting points.
They're unlikely to share any concerns and mbbs are the masters in painting rosy pictures
Every empire expands before collapsing
What are y'alls thoughts on other medium sized boutiques getting bought out such as Oliver Wyman, LEK, and Roland Berger. Or any others?
Oliver Wyman is already part of Marsh & McLennan Companies, so highly unlikely that they will be acquired by anybody else.
Roland Berger has been a target of all of the Big 4 for the last few years. However the last 2 large negotiation rounds (first with Deloitte in 2010, second with multiple big 4 in 2014) had a seriously negative impact on their market performance. Also, quite a few partners who wanted to sell left the firm when it didn't happen last time. I would say that if they manage to stabilize their operations, it is most likely that they will try as hard as they can to remain independent.
LEK is in my opinion a very likely candidate for a takeover. They are very specialized and not too large, so relatively easy to integrate. Also , their success in the market is less dependent on the individual's connections and skills rather than the brand name, so one of the large players could significantly benefit from taking them over.
Another such candidate would be OC&C. I was told that their China business was taken over by Oliver Wyman. I would not be surprised if other offices/partners will also be poached by the bigger firms in the near future.
Another interesting scenario - and granted, one that is very unlikely - is a merger between two medium sized players, much like the failed Booz + ATK merger from a few years back.
In particular, an ATK+RB merger would make create a player the size of Bain (in terms of employees and revenue), global reach (ATK is very strong in the US, RB in Europe), and scale (RB is a great strategy shop, ATK is a great operations shop). Don't think it would ever happen, but that would add an interesting dynamic to the current consulting landscape of MBB + Deloitte/PwC + boutiques.
I could see Deloitte making a play for LEK, they've been investing heavily on M&A Strategy.
Not 100% sure, but heard this as well - Bain's pitch to prospective candidates this year in recruiting was - We are NOT being acquired!
AN
They mentioned not being bought to Kellogg 1st years this year, based on what the youngin's told me.
I don't think that Bain will be acquired any time soon. They are working in a very specialized but lucrative niche where they mostly compete with LEK and McKinsey. Furthermore, I don't think that Bain Capital is doing that bad. Could rather imagine that they either decrease in size and concentrate on niche markets or merge/acquire a competitor.
LEK or ATK could be candidates for acquisition though.
The people in this thread are clueless. I'm starting to become convinced that someone at another consulting firm is trying to intentionally spread rumors. It's certainly possible that Bain is selling or that there were some sort of "talks". What's certainly true is that if there were talks, you would never hear about them.
What's also certainly true is that a lot of people in this thread are saying things that are patently false.
1) Bain isn't that overindexed to PE. Bain still does plenty of general practice work and has plenty of big name flagship clients.
2) Bain Capital is a separately run company. There is 0 impact on Bain & Company's P&L from how well that fund does.
3) Anyone who knows anything about the PE space knows that deal flow is very high right now due to low interest rates. In fact, Bain's PE practice is oversold to the point where it's allowing BCG to get its foot in the door where historically they haven't been able to compete.
Can confirm, found the Bain employee...
AN
I don't have the answer but:
Bain Capital is a client of Bain & Co. So Bain & Co partners have private information about the Bain Capital investments. Therefore, Bain Capital might be in the Global restricted list in order to avoid conflict of interest/insider trade...
Are people seriously confused between Bain Co vs. Bain Cap in this thread?
I also heard Accenture btw.
Source: I work at a F500 and my team is a client of M/B/B.
I'm fairy certain the whole "Accenture is going to buy Bain" thing was some weird hoax on the part of some angry Deloitte S&O consultants with an inferiority complex. (Looking at you opsdude1)
My sources are M/B - not D.
Says the "Consulting - Student / Prospective Monkey". Good luck breaking into the industry kid.
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For the last time, they're separate companies.
Get "transferred full time" from Bain Co to Bain Cap is as easy as being "transferred" from Bain Co to Advent or CVC. :)
Don't get too hot and bothered pr4mence, the only people who I've seen mention anything about this anywhere are the oddly common outspoken DS&O fanboys. opsdude1's doesn't do anything but shill DS&O and doesn't even work in consulting yet. John-Doe8 has a clearly ridiculous bait question about choosing between Deloitte and BCG - as if that's even a question. snakeoil doesn't work in consulting. No one who'd have any knowledge or authority on this question has mentioned a word about this.
It's a ridiculous assertion with zero real evidence. If it was happening, these people would be the last to know. Why give it the time of day?
u mad bro?
No? Did that come off as angry?
What is the point of this reply? He makes a good point that 90% of this board are people who don't even know that Bain Capital is a different company from Bain & Company, and 9% are people who didnt get into MBB and are bitter about it. There is zero reason to take anything typed here seriously, including this post.
You should come over to /r/consulting. We chased him off when he was "devils0508x", then "NYGIANTS87", and now "MBHEY". Same guy. Guess he found another outlet.
I don't work in Consulting - don't think I ever claimed that I do.
Work at a F500 where my team employs a large number of consultants from McK + BCG. I get more face time with consultants rather than people from my own firm.
So what I wrote here is not completely unfounded.
I'm am outspoken Deloitte fanboy? News to me, must be why I helped convert two of their summer interns to my firm a month ago.
bump
Sorry to Bain folks, but they did indeed shop themselves around to BCG, McK, PwC, and Deloitte a few yrs ago
From the BCG/McK perspective the price was too high considering that there was a great deal of overlap between our areas of expertise
For the audit firms it was that they would lose most of the best partners to McK or BCG in the first few years (Bc what decent partner wants to work at a lame audit firm?)
So, the strategy is to wait for the next recession, that Bain will lack the scale to weather well (they’re too weak outside North America / PE and lack real depth in fast growing areas like digital, where McK and BCG are years ahead and widending the gap)
Could be a while until this happens, but it almost inevitably will, with the most likely outcome being similar to that for Booze — i.e., swallowed up by a big accounting firm, with the best partners going to BCG and McK in short order
What will be the end result for Bain after a recession? They sell themselves to Audit firm, McK/BCG, or bankrupt?
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