TPI, EquaTerra Merger Called Off

TPI and EquaTerra, two of the industry’s leading providers of advice on the service delivery strategies for large enterprises, have announced that their merger agreement, signed in February 2006, has been terminated by mutual consent of the parties. The deal would have resulted in a 500 plus employees strong outsourcing and shared services consultancy. . TPI has been feeling quite gungho after the merger with EquaTerra was announced – One top TPI source told me that TPI is geared with the acqusiition to competing with Mckinsey’s & Bain’s in the outsourcing advisroy space and and they were hopeful of clocking hypergrowth in the next few years post merger. I am sure that even with this firms like TPI, Everest Group & Equaterra would continue to clock heady growths.While the details of why this was called off have not come in so far, it may be interesting to point out that Arcon Group also recently snapped its ties with TPI.

All these to my mind underscores amongst other things, a few key points:

- Bringing in cultural fitment/alignment between merging service organizations be lot more challenging than can be imagined.
- The market for advisory firms continues to be very attractive and is certainly showing signs of more growth in the days to come
- Advisory forms also operate through an established set of relationships, networks and focussed efforts – for all these seen from a certain perspective, size may not be all that important, assuming that the advisory firm already has reached a certain size, customer base , has good range of service offerings and established good references.
- Smaller firms like Deal Architect would continue to prosper unmindful of the designs of the bigger players.