The KPMG and Rothstein Kass rumor mill has finally come to a close.

Last Friday, the two firms announced that they have agreed to merge (see KPMG, Rothstein Kass Merger Official). Speculation of a merger has been going on for years, but ramped up again last summer after the release of a memo trying to squelch the mounting rumors.

The accounting profession had been anticipating the team-up, but Accounting Today learned that official discussions didn’t start until earlier this year. “Deals of this size take time to come to agreement on,” said Scott Ozanus, deputy chairman and COO of KPMG. “To be quite honest, we didn’t literally start talking to the principals of [Rothstein Kass] until January 2014.”

KPMG has been thinking of ways to boost its presence in the hedge fund industry, and Rothstein Kass had exactly what the Big Four firm was looking for. Ozanus explained that there was a convergence occurring in the alternative investment fund industry between real estate, private equity, infrastructure and hedge funds.

“As a firm, we have a very dominant practice within three of the four asset categories, all but within the hedge fund industry,” said Ozanus. “We looked at combining with the No. 1 hedge fund auditor out there that was not part of the Big Four. Rothstein came in at No. 3 and we were No. 5. By bringing those two organizations together, it now makes us the leading auditor within the hedge fund sector.”

Now that KPMG has a solid position in the hedge fund industry, the firm can focus on providing service to emerging funds, middle-market funds and the megafunds domestically and internationally. “It’s not only the global footprint, it’s the regulatory piece of it, the convergent piece of it,” Ozanus shared. “If you’re going to serve the mega alternative investment funds, you have to have strong capabilities in all four of the asset classes.”

In light of the merger, a vast majority of Rothstein Kass principals will be joining KPMG to assist on serving hedge fund clients. In March, an industry observer said there are a number of respectable accounting firms receiving resumes from Rothstein Kass, most of which came from the alternative investment side of the firm (see Rothstein Kass and KPMG Merger Chitchat).

Ozanus declined to comment on where the rest of the team is heading.