New Delhi (India), 25th June 2023: PwC Australia signed an exclusive agreement with private equity firm Allegro Funds on Sunday to sell its government practise for A$1, as it hired a Singaporean executive to lead the local firm through the repercussions from a nationwide scandal.
The incident, which surfaced in January, focuses around a former PwC tax partner who was advising the federal government on rules to prevent corporate tax avoidance and shared private information with colleagues who then used it to pitch for business with international corporations.
PwC said it had established an exclusivity agreement to exit its federal and state government business to Allegro Funds for A$1 ($0.67), as originally reported on Friday, amid a mounting pushback from key government clients.
PwC and Allegro both want to reach a binding deal within a month, according to a statement on the professional services firm’s website.
According to a source who was not licenced to speak with the media, if the sale goes through, Allegro would form the new company as a corporation rather than a partnership. Allegro and the former PwC partners will divide ownership, but the exact split is unknown, according to the source.
The agreement aims to shield the firm’s government advisory business and regain trust with the numerous departments and agencies that have barred the firm from taking on new clients.
Labour Senator Deborah O’Neill, who assisted in the leaking of a cache of internal PwC emails last month, stated that the firm cannot “phoenix their way out” of the crisis unless the complete names of those engaged in the secret document breach are revealed.
In a statement, Global PwC Chair Bob Moritz publicly apologised and stated that PwC Australia had failed to fulfil the firm’s standards and values under previous leadership.
Kevin Burrowes, the current Global Clients & Industries head located in Singapore, will become CEO and relocate to Sydney.
Acting CEO Kristin Stubbins will remain in the position until Burrowes arrives.
“PwC Australia has a significant work to do, and I am confident that the steps they are taking… will result in a stronger firm,” Moritz said.
