Investcorp boosts professional services portfolio with investment in PKF O’Connor Davies

The deal was made in partnership with Canada's Public Sector Pension Investment Board

Investcorp, known for its shareholding in Tiffany and Gucci during its early years of investing, currently manages about $53 billion in assets. Photo: Investcorp

Investcorp, the Bahrain-based alternative asset manager backed by Abu Dhabi's Mubadala Investment Company, has announced a “strategic growth investment” in US tax advisory company PKF O’Connor Davies, boosting its global asset portfolio in professional services.

The investment was made in partnership with Canada's Public Sector Pension Investment Board (PSP Investments), Investcorp said on Tuesday.

The value and terms of the investment, which is subject to regulatory approval, were not disclosed.

PKF O’Connor Davies, one of the largest accounting, tax and advisory companies in the US, joins the stable of professional services firms Investcorp has stakes in, a list that includes AlixPartners, ICR, Resultant, United Talent Agency and CrossCountry Consulting.

Investing in PKF O’Connor Davies is an “attractive investment opportunity”, having witnessed “strong performance in the professional services sector”, Yusef al Yusef, global head of distribution at Investcorp, said.

“With strong leadership in place, we anticipate great opportunities for PKF O’Connor Davies in the years ahead and look forward to working with them to unlock further growth potential,” he added.

For PKF O’Connor Davies, it said the investment is a “significant milestone”, as it will be able to tap into the network of two experienced investors that will help drive future growth and expand its services.

This is in addition to boosting its balance sheet that will afford the company to increase its mergers and acquisitions activities, and invest in new technologies, it added.

“This investment from Investcorp and PSP Investments further validates that we have an attractive business … [they] have a long history of backing profitable, industry-leading companies with demonstrable growth avenues,” said Kevin Keane, executive chairman of PKF O’Connor Davies.

Investcorp, which is known for its shareholding in Tiffany and Gucci during its early years of investing, has grown to become a global investment powerhouse. The company is among several international asset managers seeking funding from local and foreign investors for their Middle East-focused investment funds.

It currently manages about $53 billion in assets, including those managed by third-party managers. The company has 14 offices across the GCC, US, Europe and Asia, including, India, China, Japan and Singapore, employing about 500 people.

Investcorp was able to raise $5.4 billion in funding from global investors during its last fiscal year and expects to reach a similar level this year despite a sharp increase in geopolitical volatility in the Middle East, its vice chairman Rishi Kapoor told The National in Riyadh earlier this month.

The company also posted $4.4 billion in capital during the 12-month period to the end of June across asset classes and expects investor appetite to remain strong, with Investcorp hitting a “similar level” of investments during the current financial year, he said at the time.

On Sunday, Investcorp announced the appointment of financial industry veteran Mashaal AlJomaih as chief executive for its Saudi Arabia unit, as it seeks to boost its ties with investors in the Arab world's biggest economy.

Last month, Investcorp bought Stowe Family Law, the largest specialist family law company in the UK, from the private equity group Livingbridge, a move expected to help Stowe develop its growth strategy that aims to expand its client base to 10,000 within five years.

In March, Investcorp partnered with two sovereign wealth funds to form a $526 million fund that will invest in industrial real estate in the US. The following month, it teamed up with China’s SWF to launch a $1 billion fund that will invest in high-growth companies in Saudi Arabia, other Gulf countries and China – moves meant to further boost its global asset portfolio.