KPMG Europe suffers major Setback.
Date: 08-10-2007
Source: Accountancy
KPMG's dream of creating a single European partnership suffered a setback after the Dutch practice failed to win sufficient support to join the new super-firm.
Just days before KPMG Europe opened for business, partners in KPMG Netherlands narrowly missed securing the required two-thirds majority to accept the proposal following a lobbying campaign by a number of Dutch partners.
According to reports, a letter was sent to all 220 Dutch partners urging them to oppose the merger in the interests of the practice's 'identity' which, the partners claimed, would have been threatened by the 'strongly finance-driven culture' of the UK firm.
The setback will be a major blow to the firm's aspiration of creating a single European firm, which has been made possible by changes to the Eighth European Directive allowing cross-border ownership of accountancy partnerships.
So far, the UK, German and Swiss practices have come on board, creating a EUR3.5bn (£2.4bn) firm with 1,100 partners and 17,000 staff. But a KPMG spokesman said the firm expected the Dutch practice to have a re-vote on the issue 'in a few weeks' time', and confirmed talks were progressing with other national firms.
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