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by Vault Consulting Editors | June 07, 2010

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And while this potentially landscape-altering partnership is far from final, no one's exactly denying it, either. The Financial Times broke the story last week, reporting that Booz Managing Partner Shumeet Banerji and A.T. Kearney CEO Paul Laudicina have agreed to some of the initial details of the partnership. The deal would be a response from consulting firms to capture more market share and to cater to their largest, increasingly global, increasingly demanding clients, in the face of recessionary pressures.

If the mid-sized firms were to combine, it would make the new entity the third-largest independent strategy firm—behind McKinsey and BCG—with over 6,000 employees and close to $2 billion in annual revenue. The merger would be beneficial in terms of helping the two broaden their economic reach, making them better able to compete for market share with larger firms. The merger would also give Booz a leg up in operations and supply chain strategy—an area where A.T. Kearney can add value. After all, the buzzword of late in the consulting industry is "scale," with firms bulking up and broadening their global reach and service offerings in the never-ending attempt to offer everything to everyone.

It seems the rumors are leaning more and more toward truth. A few industry insiders I spoke to said they had heard the deal was confirmed, but of course, nothing's final until the interested parties have signed on the dotted line. And, as one skeptical former Booz consultant told The Wall Street Journal, Booz has considered merging with Kearney "a half dozen times in the 25 years I was with the firm. It didn't happen, because so few mergers of management consulting firms work," he added. "There's not a whole lot of value created by mergers."

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Filed Under: Consulting

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