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What’s in a name? Advisory firms Beavis and FRP by any other names would smell as stale

July 16th, 2010

A couple of new names have risen in the accountancy firmament — Beavis Morgan and FRP Advisory. But appearances can be deceptive and the new businesses are, perhaps, not quite what they seem.

The Beavis Morgan name — given to the limited liability partnership (LLP) formed in June 22nd 2010 as a vehicle to snap up parts of bankrupt mid-tier accountancy firm Vantis — reflects the origins of two of Vantis’s antecedent firms.

Beavis Walker was a seven-partner City of London-based accountancy practice acquired by Vantis for up to £5.1m in cash and shares in 2003. The Morgan part of the name is derived from Morgan Brown & Spofforth one of four accountancy practices that merged to form Vantis at the time of its May 2002 IPO.

The partners in the new vehicle, Beavis Morgan LLP, bear a striking resemblance to partners and board directors of the bust Vantis. They include Paul Jackson, Paul Ashton, Matthew Burge, Barrie Dunning and Nigel Haigh — who worked at Morgan Brown & Spofforth in its pre-Vantis days.  Other partners in the recently launched vehicle include Richard Thacker and Peter Drown (both former partners at Beavis Walker). The other partner, Alan Ford, joined Vantis from another firm.

These guys will continue to pace the corridors of Vantis’s former head office in London’s St John Street, whose freehold I believe they personally own. Meanwhile the state-owned banks Lloyds Banking Group and RBS and the taxpayer have been left bearing massive losses.

Once this and other prepack deals involving former Vantis entities, all handled by administrators from FTI Consulting Chad Griffin and Simon Granger, are complete the two state-owned lenders can be expected to receive an estimated 20p in the pound, which means they will be nursing losses of some £40m from their lamentable decision to lend money to Vantis. Her Majesty’s Revenue & Customs would be lucky to get 1p in the pound, meaning its losses are about £5m.

Sources tell me the culture that pervaded at Vantis — “inflated egos looking for any way to inflate the share price” — will carry through to the successor outfits.

Other parts of Vantis have been “phoenixed” into other vehicles in what appear to have been equally questionable ways. The 28 partners in its insolvency and corporate restructuring unit have acquired that business in another pre-pack, led by Jeremy French and Geoff Rowley. This too has been dressed up as a “management buyout”.

The vehicle was another limited liability partnership, FRP Advisory LLP, formed on June 15th 2010, whose website is, at the time of writing, perhaps the least transparent (in terms of the new business’s origins and the identity of its partners) I’ve ever seen.

Intriguingly, the head of banking at FRP Advisory is Simon Glyn, the former Vantis partner who in 2003-04 was seconded to the role of “personal assistant” to Lynden Scourfield, the “rogue banker” at the centre of the £1 billion Bank of Scotland Reading scandal. The matter, in which Glyn/Vantis were involved in more ways than one, is currently being investigated by an enforcement team from the Financial Services Authority and by other UK authorities.

Other parts of the former Vantis empire have been acquired by the accountancy firm RSM Tenon for a reported £7m. It will intriguing to see how long it will be before the Vantis guys revert to type.

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7 Comments for “What’s in a name? Advisory firms Beavis and FRP by any other names would smell as stale”

  1. Matthew Burge is ex-Morgan Brown and Spofforth, but he was from a different generation than the big players in the whole affair. Only a couple of the people you mention are deserving of opprobrium. Others are honest men who have the misfortune to be the junior partners of the two or three people who drove the Vantis idea. Good accountants who couldn’t have stopped what happened if they had tried. There is no reason why they shouldn’t go on serving their clients as they always have.

  2. Thanks OC – I have corrected Matthew Burge’s status. You say:-

    Others are honest men who have the misfortune to be the junior partners of the two or three people who drove the Vantis idea. Good accountants who couldn’t have stopped what happened if they had tried. There is no reason why they shouldn’t go on serving their clients as they always have.

    I agree with the principle of this statement. However (a) Surely there must have been something they could have done? and (b) I’m afraid that some of the people involved with these phoenixed accountancy firms, such as Simon Glyn, do have “questionable” histories.

  3. I have never met Simon Glyn, and I’m glad of that, but I do know something about the origins of Vantis. It was essentially Morgan, Brown & Spofforth with delusions of grandeur. Morgan, Brown & Spofforth was not a partnership of equals. It was controlled by just two or three people, maybe in substance by just one, and he/they were never going to change their spots. The only realistic thing that anyone who didn’t like their ways could do was to leave, which I did a long time ago, before it transmuted into Vantis. Most talented staff below partner level left after fairly short terms of service.

    The architects of Vantis were wideboys from small firm backgrounds, who had never seen any other side of the “profession”, and simply had no conception of the likelihood that their approach would result in corporate death through reputational disaster if they reached above their natural level.

    I don’t blame the partners outside the inner circle for staying, because most of them had been with the predecessor firms all their adult lives, and they would have had a great deal more difficulty than I did in extracting themselves. I expect that they were contractually tied up in knots.

  4. So it continues. Two ex-Vantis insolvency practitioners, both now working at FRP Advisory alongside the notorious Glyn, have been accused of misconduct re: the administration of the high street fashion chain Miss Sixty

    http://www.financialdirector.co.uk/accountancyage/news/2266992/miss-sixty-administrators

    A High Court judge accused Nick O’Reilly and Peter Hollis of misconduct over the Miss Sixty CVA. Two landlord creditors of Miss Sixty wanted to call a halt to the CVA claiming it treated them unfairly. The judge has ruled against O’Reilly and Hollis, and in favour of the landlords. He said the two administrators “lost a proper sense of objectivity” and had sided with the Sixty Group against the interests of the guaranteed creditors such as landlords. The judge said there was a “prima facie case of misconduct” which should be considered by the professional bodies to which the pair of administrators are answerable. Mr Justice Henderson said: “This is, in my view, a CVA that should never have seen the light of day.” The ruling only further erodes any faith that anyone may have had in insolvency practitioners’ ability to self-regulate.

  5. Thanks Gavin.

    Interested to note that Carl Jackson head of recovery at RSM Tenon has just been fined and reprimanded for failing to collect £330,000 as liquidator of a failed company and instead hiding the funds, which were due to the liquidated company’s creditors in a bank account in Monaco. RSM Tenon is the listed accountancy group that acquired the bulk of Vantis PLC. Jackson was fined just £5,000, reprimanded and ordered to pay costs of £83,557 .

    http://www.accountancyage.com/accountancyage/news/2267846/rsm-tenon-recovery-chief-fined

  6. [...] David Mills occurred in January 2010. This one, handled not by PwC but by the now bankrupt Vantis, saw stationery company Concord Office Products, avoid having to pay some £4m owed to creditors [...]

  7. I’m a little late in on this one — I worked for Morgan, Brown & Spofforth and then Vantis for over three years. I was totally taken aback by how the company was run (or should I say overseen) by the two at the top. It was run, as far as I could see, on greed and staff were spoken at and down to. I was involved in the flotation of the company on AIM and thought then it was again greed and overblown egos.
    I am glad I escaped when I did.

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