BDO Dunwoody LLP and Grant Thornton LLP have ended their merger discussions.

“No specific reason led to the decision to cease discussions; however, both firms recognized that despite the potential of the union, a merger of this nature also presented significant challenges,” the companies said in a joint news release today.

“The due diligence process had proceeded amicably and with the co-operation of both firms, but despite best efforts the two firms were unable to overcome the challenges, and therefore were unable to complete the process to the satisfaction of all involved.”

When the merger talks were announced last month, Grant Thornton and BDO Dunwoody said their goal was to be an alternative to the Big Four accounting firms.

Grant Thornton is the fifth-largest accounting firm in Canada with about $400 million in annual fees and BDO Dunwoody ranks six with $300 million.

Grant Thornton, the Canadian member of Grant Thornton International, has 370 partners and 2,900 employees at 99 offices across the country. BDO Dunwoody has 315 partners and 1,900 employees in 95 offices, and is the Canadian member firm of the BDO International network.