San Francisco (June 7, 2002) -- Bucking the trend among many Big Five consulting spin-offs of going public, Deloitte Touche Tohmatsu said its Deloitte Consulting unit will become a privately-held company.The announcement was made Thursday by Deloitte Consulting chief executive Doug McCracken in San Francisco, where the firm’s 1,200 partners and directors gathered. The separation, which is subject to a vote by the Deloitte Consulting and DTT boards of directors and the boards of DTT’s member firms, is expected to be complete by year-end.
"The market has changed, partly in response to the Enron issues but also because business problems are becoming bigger and more complex, and we believe that as a private firm we can best meet the needs of the market," said McCracken, who called the move "a legal and functional transaction" and noted that the firm has been autonomously managed and governed since 1996.
Under pressure from regulators and the public that was heightened by Enron's implosion and Andersen's subsequent downward spiral, the firm first announced its plan to separate from Deloitte Touche Tohmatsu in February.
McCracken outlined a number of changes already underway, including the creation of a new internal measurement and reward systems "directly linked to the firm’s ability to deliver value to clients"; and new client-facing roles for senior principals who previously led practices or served in senior management roles. In addition, free from its accounting firm ties, the firm said it will explore new types of relationships with clients such as joint ventures & profit sharing.
Deloitte, which has hired brand consultancy firm Interbrand, plans unveil a new name and brand later this year.
-- Electronic Accountant Newswire staff
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