(By Richard Holway) Technology and management consultancy, Bearingpoint, has just filed for bankrupcy in the US. This is no 'small tech company' - Bearingpoint employs 15,200 people in 60 countries worldwide and had revenues of c$3.3 billion in 2008. They have a really blue chip customer base (whatever that is worth in today's troubled times) across the private and public sectors. Although troubles at Bearingpoint have filled the rumour mill for some time - their NYSE listing was suspended two months ago- this is still quite a shock. The announcement says that their activities will continue 'as normal'...Bearingpoint has a long, 100 year pedigree being formed out of KPMG's Consulting activities. They IPOed in 2001 and went on a buying spree. Indeed they did some 30 acquisitions between 1999 and 2002 including acquiring bits of Arthur Andersen (remember them) and KPMG's consulting operations in other countries. They changed their name to Bearingpoint in 2002. Now its their $1 billion debt which has done for them.
I think this just shows how difficult the management consultancy market is right now - something we have heard across the board at our interviews. With new projects on hold, management consultants, who often have as bad a reputation as bankers, are an easy first target for cost cutting. But this must set the alarm bells ringing in many a marbled hall right now.
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