Boss of KPMG restructuring spin-off Interpath to step down

The boss of struggling private equity-backed UK restructuring business Interpath Advisory, which was sold by KPMG in 2021, is set to leave.

Chief executive Blair Nimmo will step down from Interpath in the spring, the company said after being approached by the Financial Times.

Interpath has suffered widening losses since it was offloaded by the Big Four firm to HIG Capital for about £400mn. This is despite a jump in distressed companies hit by rising rates, a main source of its business.

Group losses widened to £10.6mn during the 12 months to March 2023 compared with a £10.2mn loss in 2022, although revenues have jumped by more than a fifth to £142.6mn in the latest financial year.

It has also expanded internationally during the latest financial year, opening three offices in Ireland and acquiring offshore restructuring specialist Kalo Caribbean, which operates in the British Virgin Islands and the Cayman Islands.

Mark Raddan, a former KPMG partner who serves as head of advisory at Interpath, is to be appointed as Nimmo’s successor, the company said. He is due to take over from April 1.

Partners had not been informed about the move when the Financial Times approached the company earlier on Wednesday, according to people familiar with the matter.

Interpath confirmed Nimmo will remain with the firm for a number of months to oversee a transition before retiring.

Nimmo, a former KPMG partner and head of restructuring at the Big Four firm, led the move to sell the division to HIG with Raddan and Will Wright, a managing director at Interpath.

The deal was one of several recent examples of buyout firms investing in the professional services industry. In 2021, Deloitte also offloaded its restructuring unit to Teneo, which is backed by private equity group CVC.

HIG’s acquisition of Interpath is widely considered among industry figures to have been less successful than Teneo’s cheaper purchase of Deloitte’s restructuring arm.

The disposals came after executives in the restructuring practices of some of the Big Four audit and consulting firms became concerned that conflict of interest restrictions made it increasingly difficult to take on new clients.

However, while spinning out divisions into separate entities frees them from conflict rules within the Big Four, some partners are sceptical of the benefits when weighed against the loss of internal referrals of work.

Headcount at Interpath has risen from 550 since the company separated from KPMG to about 740 at the end of last year.