Merger discussions between management consultancies Booz & Co and AT Kearney have collapsed, leaving both strategy specialists exposed to predators and the loss of leading partners and staff.

Talks between the firms were revealed in June, but ceased early last week with a joint statement saying: “AT Kearney and Booz & Co confirm that they have ended discussions about a possible merger of the two partnerships. While the two firms greatly respect each other’s legacy and capabilities, they have determined that their future aspirations will be best realised as separate partnerships.”

In a market dominated by large, global consultancies and characterised by a fall in pure strategy consulting in favour of a broader approach, the collapse of merger talks may make both firms’ positions more precarious, with competitors keen to poach talented employees and partners who are worried about their future, and large consultancies perhaps playing the acquisition card.

The merger was set to create the third largest independent strategy consultancy in revenue terms behind McKinsey and Boston Consulting Group. In 2009, AT Kearney reported revenue of $786 million (£519 million), down from about $900 million in the previous year. Booz & Co achieved revenue of about $1 billion last year.

Joining forces would also have created strength in numbers through the combination of AT Kearney’s 2,500 employees and 240 partners, and Booz & Co’s 3,300 staff and 200 partners.

Source: Management Consultant News Direct