EY and KPMG have signed an agreement to merge their Denmark operations.

The merged firm will operate under the EY name and will be part of EY’s Nordics region.

The deal, which will see EY absorb 1,500 employees across 21 offices, is subject to approval by the relevant regulatory authorities.

Jesper Koefoed, head of KPMG’s branch in Denmark said that the deal with EY would strengthen organisation’s local market position.

Until regulatory approval is received, business will be as usual for both organizations. The regulatory authorities are expected to make a decision about the deal in 2014.

Recently, KPMG’s former head of private client tax practice, David Kilshaw, has moved to EY’s tax team as a partner.

Erik Mamelund, regional managing partner for EY Nordics, said:"This agreement draws on the complementary strengths of EY and KPMG Denmark. Until regulatory approval is obtained it would be premature to say anything further."

Michael Andrew KPMG global chairman said: "I can confirm that our Danish member firm has decided to leave the KPMG network. We believe a number of non-equity partners and staff will make a positive choice to remain with KPMG.

"We remain committed to having a strong, effective and focused firm in Denmark that can serve local and global clients and provides the market with the choice of at least four large professional service firms," he added.