International consultancies Rider Hunt and Levett & Bailey are in talks to find a UK partner after it emerged that its global alliance with Gardiner & Theobald is on the brink of collapse.
Building understands that senior management from Rider Hunt Asia Pacific have been in Britain to assess alternative partners with a view to making progress in Europe.
A source close to the alliance said it was not clear why the G&T alliance was failing. He said: “It was never disclosed how the profit share between the companies would work; it was a very private agreement but it is clear something is not working. When the deal was struck there was a clause that allowed it to be renewed every five years to counter economic slumps and fallings out.”
The source added that it would be difficult for the Australian Rider Hunt and Hong Kong Levett & Bailey partnership to form a similar agreement with the big UK QS practices. He said: “Most of the top five firms have major international operations already so they’ll have to start looking at the next tier.”
The alliance, formed in 1997, was set up partly to act as a cushion in downturns and to challenge Davis Langdon’s global domination.
The deal revolved around a single holding company, into which each firm pays a sum from profit. The proportion of the overall profit accounted for by this sum is then calculated and the percentage paid every year to other partners or invested jointly.
Rider Hunt and Levett & Bailey will have to start looking at the next tier
Source close to the alliance
The alliance has offices around the world and a combined staff of more than 2,000 and more than 100 offices worldwide including offices in South-East Asia, Hong Kong, China, Australia, New Zealand, the UK and Europe, and the USA.
G&T and Rider Hunt refused to comment and Levett Bailey was unavailable to comment.
One rival QS said that any break up of the alliance would not be a surprise but would still be shocking given its significance. He said: "It's part of the glamour of a company to have foreign tie ups, all the big players have them. I'm sure G&T will be asking the question of their international partners as to what is exactly going on here. I'm sure they'll be trying to salvage something."