News round-up: LECG, Department of Justice, Infosys

by Vault Consulting Editors | March 01, 2011

  • My Vault

Hello and welcome to the first news round-up of the month of March. Together, we'll welcome the long winter's thaw. The birds will sing, the petals unfurl; soon it will be spring. Consulting news is reborn anew.

The LECG divestiture saga continued today, as FTI Consulting shed more light on the nature of its acquisition of two LECG practice groups and hinted at more to come. As reported earlier this week, FTI capitalized on LECG's financial weaknesses by purchasing its international arbitration and aviation competition practice groups. According to a press release, the transfer of affected LECG employees to FTI has already occurred, though physical relocation will take more time. More interesting was FTI's assertion that deals to acquire more practice areas remained on the table. The firm "confirmed it continues to evaluate the possible acquisition of several additional practice groups from LECG." Sure, it's brief and not terribly in-depth, but consider the consequences: LECG simply doesn't have much more to give. Between the losses to FTI and the even greater losses to Grant Thornton, the further divestiture of practice groups will almost certainly spell the definitive end of LECG as an independent firm. It's thought that neither FTI nor Grant Thornton are willing to fork over enough for a bona fide acquisition (and why would they, considering LECG's recent track record?), so the practice group auction looks set to continue. Death by a thousand cuts (or in this case, 27.8 million).

UPS published its annual report for 2010 today, in which it discussed little of consequence. Luckily for us, the Wall Street Journal took a fine-toothed comb to it and exposed this gem: "the antitrust division of the U.S. Department of Justice has opened a civil investigation of its policies and practices regarding how it deals with third-party shipping negotiators and consultants." UPS's admission that it's being investigated by the DoJ centers around claims that one Oregon consulting firm, AFMS LLC, made alleging illegal cooperation between UPS and chief rival FedEx. The firm, which specializes in supply chain and distribution efficiency, says that the shipping giants broke American antitrust laws when they colluded to price out small third parties from accessing potential clients. "The antitrust division is investigating the possibility of anticompetitive conduct in the market for the delivery of time-sensitive parcels," was all the DoJ had to offer, but now you know what they really mean. Oh yeah.

A new report written by European bank BNP Paribas suggests that Infosys could have its first non-Indian CEO in a couple of years, says the Times of India. Currently helming the IT consulting behemoth is N. R. Narayana Murthy, who is set to retire in August. His absence looks set to open the door for Steve Pratt, the current CEO of Infosys Consulting (a division of the larger Infosys company). BNP Paribas has written several similar reports on an impending internal shake-up at Infosys; the company will likely follow competitors TCS and Wipro before it in installing new leadership in hopes of accessing the global (non-Indian) market more effectively. Pratt is seen as a rising star (non-Indian) in the organization.

For more information:
FTI Consulting Acquires Certain Practices of LECG
WSJ
Times of India

Filed Under: Consulting

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