In a surprising move, PwC Australia has sold its government business to private equity firm Allegro Funds for a mere $1. Following the sale, the government consulting division will now operate independently under the name Scyne Advisory. Allegro Funds plans to invest over $100 million in the business and has confirmed that it will hire 1750 personnel from PwC.
The contractual deal was announced on Tuesday, with Allegro emphasizing that Scyne Advisory will operate independently from PwC Australia, aiming to distance itself from the scandal-plagued reputation of its former parent company. To enhance corporate governance, Scyne Advisory will have an independent board. Notably, former Federal Court judge Andrew Greenwood will join as a non-executive director, while candidates for an independent chair, CEO, and other non-executive roles are still being interviewed.
To ensure a smooth transition and minimize client disruption, 12 senior leaders from PwC's Government Health Infrastructure and Defense (GHID) and Trust and Risk (T&R) divisions, which comprise the new organization, will oversee the operations of Scyne Advisory.
The probity, conflict, and ethics subcommittee, which Andrew Greenwood will chair, is one of the boards that Scyne Advisory will establish. Additionally, there will be an audit and risk subcommittee, as well as a personnel and remuneration panel. These measures aim to promote transparency, accountability, and ethical practices within the new company.
The sale of PwC's government business comes in the wake of a series of scandals that tarnished the firm's reputation and resulted in the loss of government clients. By divesting this division, PwC hopes to rebuild trust and restore its standing in the market.
Scyne Advisory, derived from the Old English word for "scene," symbolizes a new beginning for the troubled government consultancy business. The name reflects the company's aspirations to create a beautiful and brilliant future while leaving behind past controversies.
Scyne partner Tim Jackson, one of the 12 former PwC partners leading the interim leadership of Scyne Advisory, expressed enthusiasm for the opportunity to redefine public sector consulting in Australia. Jackson emphasized the commitment to operate in a conflict-free manner, placing clients' interests at the forefront. Scyne Advisory aims to build a culture of trust and integrity, modeled after the Australian Public Service Code of Conduct, which emphasizes honesty, integrity, diligence, and the responsible use of information.
Adrian Loader, co-founder of Allegro Funds, expressed support for the new executives of Scyne Advisory and their vision to drive real change in public service advisory. He believes that the Australian market needs an independent and reputable government advisory firm of significant scale. Loader emphasized that Scyne Advisory will adopt an industry-leading governance model that aligns with Australian government and agency requirements.
The sale of PwC's government business to Allegro Funds marks a significant turning point for the troubled division. With a fresh start under the name Scyne Advisory, the company aims to regain trust, implement strong governance practices, and deliver exceptional public sector consulting services to clients across Australia.