Grant Thornton's Johannesburg office merges with BDO South Africa

The increasing collaborative activity between Grant Thornton Johannesburg and BDO in South Africa over the last year has now culminated in the merger of the two firms to form the largest mid-tier accounting and advisory firm in the country, behind only the Big Four companies that will now be competitors for the new entity. 

Late last year, global accounting and advisory firm BDO declared its intentions to ramp up its operations in the South African market, starting with the poaching of over 400 professionals – including 35 senior executives at partner and director level – from fellow professional services firm Grant Thornton.

The move, which happened in March this year, saw the addition of Grant Thornton’s offices in Cape Town and Port Elizabeth to BDO’s operations, and took its South African outfit to over 1,000 professionals. "BDO South Africa will now be in a far stronger position to take advantage of opportunities in the market and to provide a significant alternative to the competition,” said Mark Stewart, CEO of BDO South Africa, at the time.

Now, the two firms have taken their relationship one step further, as Grant Thornton’s Johannesburg outfit will now merge with BDO entirely, forming a combined entity spanning seven offices across the country, the biggest of which will be in Johannesburg – consisting of 900 professionals, partners included.

With the addition of Grant Thornton’s office, the Johannesburg outfit of the merged entity has combined fees in excess of $90 million. The merger is expected to formalize later this year, and is expected to run smoothly in light of the fact that the cultures at the two firms have been observed to be a close match.

The combined force forms the largest mid-tier accounting and advisory firm in South Africa, and is being touted as a “credible alternative to the four largest auditing firms in South Africa.” Things have not been smooth sailing for the Big Four in the country recently, particularly for KPMG that has been embroiled in scandal.

KPMG has since had to offload a large portion of its staff, and has looked to the firm’s international network to help rebuild its local operations. BDO is hoping to capitalise on this weakened position and damaged credibility to develop its business in the country, in addition to evolving with global market trends.

“The audit profession is undergoing huge change currently, and the demand for in-depth, technical and industry expertise is critical,” said Stewart. Stewart himself was named CEO in 2014 after nearly three decades with the firm, and has since taken BDO from strength to strength in South Africa.