H.I.G. Capital is set to initiate a formal sale process for Interpath Advisory, with reports indicating a targeted valuation of £800 million. The private equity firm is currently soliciting pitches from banks to manage the sale.

Interpath was formed in 2021 when KPMG divested its restructuring division amid conflict of interest concerns. This £400 million carve-out allowed the unit to operate independently, supported by H.I.G. Europe. Although it became the largest independent corporate turnaround firm in the UK, Interpath faced challenges initially, posting losses of £10.6 million for the year ending March 2023, following a £10.2 million loss the previous year.

However, the firm has since improved its financial performance, achieving a £3 million pre-tax profit in 2024. This turnaround coincided with a leadership change, as Mark Raddan took over as CEO from Blair Nimmo.

The current economic climate, characterized by high interest rates and macroeconomic uncertainty, has led to a slowdown in deal activity for private equity firms. Despite this, the consulting sector remains attractive, potentially making an exit from Interpath more feasible for H.I.G. than other investments in its portfolio.

Reports from the Financial Times indicate that H.I.G. is aiming for a valuation that is double what it paid for Interpath four years ago. While neither H.I.G. nor Interpath has commented on the sale, banks have begun pitching their services to advise on the transaction.

The interest in consulting firms is reflected in recent private equity investments in the sector. Notably, Cinven acquired a majority stake in Grant Thornton, the sixth-largest audit firm in the UK, in November 2024. Additionally, Smith & Williamson received a £700 million investment from Apax Partners during the same month. Earlier in 2025, Axiom GRC launched with £500 million in backing from Inflexion.

In summary, H.I.G. Capital's decision to sell Interpath Advisory appears to be a strategic move to capitalize on the firm's improved performance and the ongoing interest in the consulting sector, despite broader economic challenges.