KPMG UK to mine 'data oil' in M&A with Nuix alliance
With organisations increasingly recognising both the value and risks presented by data in M&A transactions, Big Four giant KPMG has extended its alliance with cybersecurity, risk and compliance provider Nuix, with the UK business now leveraging Nuix’s forensic technology within its M&A offering to drive cost savings and act as an “accelerator” in the M&A market.
The new agreement will see KPMG UK’s forensic technology practice deploy Nuix software, which indexes, searches and analyses large volumes of unstructured data. KPMG supports clients in responding to data needs in disputes, investigations, M&A divestments and regulatory and internal reviews.
It comes as businesses are increasingly realise the hidden value that can be extracted from their structured and unstructured data – meaning that data has become a key asset in M&A transactions. Questions over who, how and where data is being used requires detailed attention to ensure that it is protected, managed or potentially carved-out. KPMG’s deployment of Nuix software will facilitate this process and mitigate potential risks, such as litigation, non-compliance and increased cost and disruption to business as usual.
Darren Pauling, managing director of forensic technology at KPMG, said: “Businesses are generating a increasingly large amount of data each day. While they are realising the hidden value that can be extracted from data, they are often becoming overwhelmed by its volume and complexity. Market consolidation through M&A activity, combined with the pressures of regulatory mandates, such as GDPR, mean that more and more clients need to find ways to better understand and efficiently manage that data.”
While this is a major win for Nuix, it is not the first KPMG-Nuix alliance: the US member firm of KPMG – KPMG LLP – in 2014 announced a strategic alliance combining KPMG LLP’s holistic forensic technology capabilities with the Nuix engine: KPMG is a Swiss co-operative, meaning the US is run as a separate business.
Inevitably the move by KPMG (and its perhaps deliberately provocative headline “KPMG targets M&A market with Nuix’s powerful data analysis capabilities”) will (rightly) spark fear among law firms, striking as it does at the heart of their much prized and protected transactional work.
KPMG – along with the remaining Big Four, Deloitte; EY and PwC –has for the past few years pushed to grow its M&A work as audit and tax work opportunities reach a plateau.
Within KPMG’s legal services division there is a strong corporate bent. The first of the Big Four to be granted an alternative business structure licence, in 2014, KPMG late last year made two senior corporate hires: M&A partner Richard Lewis joined from Eversheds to head KPMG’s London corporate legal team; while Shoosmiths partner Emma Gibson, who headed the firms corporate group in its Thames Valley office, joined KPMG to establish a legal services hub in Reading.
KPMG’s legal services business – which has around 1500 lawyers worldwide – in the UK is headed by Nick Roome, who previously spent 15 years as a corporate lawyer at Addleshaw Goddard and DLA Piper.
Nuix, which is headquartered in Sydney, Australia, has its EMEA base in London, with global operations in the U.S, Ireland, UAE and Germany. Its technology can support digital forensic investigations, information governance, email migration, privacy and data remediation services.
Jonathan Rees, chief executive officer, EMEA at Nuix, said: “Our relationship with KPMG is one that clients across all sectors will benefit from. With the highly talented forensic technology team at KPMG, combined with the unrivalled indexing, processing and analysis capabilities of Nuix’s technology, investigations can be conducted efficiently, cost-effectively and comprehensively. At a time when data is being considered the ‘new oil’, it is a powerful partnership. We’re proud that KPMG has such confidence in our solutions.”