Cambridge, MA: Monitor Group, once one of the world's most prestigious strategy consulting firms, filed for Chapter 11 bankruptcy protection in the US last week, and Deloitte Consulting agreed to pick up the rump of its practice.
Monitor, founded by Harvard Business School strategy guru Michael Porter in the '80s, told the State of Massachusetts this week that it was laying off 235 staff, but it expects Deloitte to take on most of its 1200 employees around the world.
In an upbeat formal statement Monitor said that it had "agreed to join forces" with Deloitte.
Under the asset purchase agreement with Monitor, Deloitte Consulting LLP will acquire Monitor's US practice, and practices outside the U.S. will be acquired by certain other member firms of Deloitte Touche Tohmatsu Limited.
"Upon closing of the transaction, Monitor's and Deloitte's Strategy consulting practices will combine to forge a new and pre-eminent global presence in the industry, bolstered by Deloitte's leadership and reputation globally", the statement said.
The complementary strengths of the two organizations will be manifest from the outset, they claim, creating:
- A confirmed leader in strategy consultancy
- One of the largest life sciences strategy practices
- One of the largest marketing strategy practices
- A broad-reaching innovation strategy and execution practice
Bansi Nagji, President of Monitor, said, "Monitor has built a unique brand in the field of strategy consulting over 30 years, renowned for highly customized client solutions and world class intellectual property and thought leadership. Our talent base — from partners to employees — is of the highest quality, working collaboratively across borders to serve our outstanding network of global clients. The opportunity to marry these qualities with the extraordinary strengths of Deloitte, and to invest together to serve our clients' rapidly evolving needs, is hugely motivating."
Michael Canning, national managing director of Deloitte Consulting LLP's Strategy & Operations practice, added, "We have long admired Monitor for its excellence in strategy consulting and we are excited about the fit and compatibility of our practices.
"Deloitte and Monitor leadership will work closely together to capture the best of both organizations and enhance our capabilities as world-class global strategy practices that provide clients with exceptional value.
"The combination of practices with Monitor's will further accelerate Deloitte's growth in the strategy space and what we develop together will reshape our industry. I look forward to working closely with my new colleagues from Monitor as we bring that vision to life."
In its statement, Monitor concedes that as a "pure-play strategy consultant", it was facing increasing financial pressure as a stand-alone business. The recent economic downturn drove Monitor to evaluate its strategic options and determine that Deloitte was not only the right strategic match, but also provided the opportunity for substantial short-term and long-term growth as well as opportunities for its employees and clients.
To help facilitate this proposed transaction and preserve the firm's value as a going concern, the assets will be sold by means of a court-approved sale under Section 363 of the U.S. Bankruptcy Code. The transaction with Deloitte would be completed following approval of the U.S. Bankruptcy Court in Wilmington, Delaware and is subject to, among other things, higher or otherwise better offers, as well as regulatory approvals.