M&A roundup: Top 100 firms on the prowl

CBIZ, a Cleveland-based publicly traded financial company, has acquired the nonattest assets of Top 100 Firm Somerset CPAs and Advisors, an Indianapolis-based firm, effective Feb. 1, 2023. Simultaneously, Mayer Hoffman McCann PC, a national independent CPA firm affiliated with CBIZ through an alternative practice arrangement that puts them in the Top 10 Firms, announced the acquisition of the attest assets of Somerset. 

The acquisition will add $55 million to CBIZ's revenue. CBIZ and MHM together ranked No. 10 on Accounting Today's 2022 list of the Top 100 Firms, with $1.08 billion in annual revenue, while Somerset ranked No. 95.

Somerset has been providing accounting, tax, and financial advisory services to clients for over 60 years. With offices in Indianapolis, Michigan City and Fort Wayne, Indiana, as well as Nashville, Tennessee, Somerset is the fifth-largest accounting service provider based in Indianapolis, with 250 employees. 

"We are excited to enter the Indianapolis financial services market with an established partner that has a reputation for providing outstanding client service and possesses the size and scale to accelerate growth and bring added value to our collective clients," said CBIZ president and CEO Jerry Grisko in a statement Thursday. "Together, we will now be able to provide our combined clients with an expanded breadth of services backed by a national network of professionals. Somerset's depth of expertise across numerous industries also creates strategic opportunities to better serve our current clients and attract new ones."

"We are very excited to join CBIZ," said Somerset president Ben Kimmerling in a statement. "Being a part of a premier national accounting provider will ensure our clients continue to receive best-in-class service and solutions to help them grow their businesses successfully. Our shared vision of building relationships and delivering results make this a perfect combination, and will also provide our employees with additional training, development, and career growth opportunities."

The Koltin Consulting Group advised both firms on the transaction. "The combination of CBIZ and Somerset presents a unique opportunity for growth in the solid and expanding Indianapolis market," said CEO Allan Koltin in a statement. "CBIZ and Somerset share a remarkable commitment to building meaningful client relationships and providing a broad array of services to meet their clients' needs and the benefits of this transaction will be immediately evident to their combined clients and their team members."

In January 2022, CBIZ acquired Marks Paneth, a Top 50 Firm based in New York. In 2021, it acquired Shea Labagh Dobberstein, a firm in San Francisco, and Berntson Porter & Co. in Bellevue, Washington.

Doeren Mayhew, a Top 75 Firm based in Troy, Michigan, has acquired the Small Business Administration consulting practice of Garcia & Ortiz PA, a firm based in St. Petersburg, Florida, and its proprietary GOLoan Review software, for an undisclosed sum. 

Garcia & Ortiz's SBA practice has 13 individuals joining Doeren Mayhew. Doeren Mayhew ranked No. 51 on Accounting Today's 2022 list of the Top 100 Firms, with $116.5 million in annual revenue, over 75 shareholders and nearly 500 employees. 

Garcia & Ortiz has been doing SBA loan review and compliance consulting for nearly a decade. It has completed more than 15,000 SBA loan reviews and developed its own software to help lenders review their 7(a) loans for compliance with the SBA's standard operating  procedures. 

"For years, Garcia & Ortiz and its SBA practice leader Leslie Tripp have been highly regarded within  the lender community as a trusted advisor," said John Murnane, Doeren Mayhew's financial institutions  group shareholder and practice leader, in a statement Thursday. "We see meaningful synergies between our practices to share resources and become an SBA lender consulting powerhouse." 

Garcia & Ortiz will remain in business, but will focus on clients outside the financial services sector.

"We are very proud of the SBA practice Leslie and her team has built over the years," said Garcia & Ortiz senior shareholder J. Edward  Del Rio in a statement. "We've always tried to put our client's needs ahead of  everything else, and it is for that reason we ultimately came to the decision to sell our SBA consulting  practice to Doeren Mayhew. They bring the benefit of more resources and an expanded suite of services  to create greater value to our SBA lender clients." 

Last year, Doeren Mayhew acquired Kaplan Merzlak, a firm in Bloomfield, Michigan, and Beene Garter in Grand Rapids. In 2021, it acquired Darlene Plumly CPAs in Houston, and in 2019 added Thrasher & Associates and Evans & Chastain, also both in Houston.

Cohen & Co., a Top 75 Firm based in Cleveland, plans to acquire BBD's Investment Management Group, a Philadelphia-based provider of audit and tax services for registered and unregistered investment companies. The deal is expected to close in March.

Cohen & Co. said the deal would make it the second-largest auditor of exchange-traded funds and fourth-largest registered funds auditor in the U.S. by number of funds. The group will have 300 professionals and expand Cohen & Co.'s footprint to Philadelphia.

"We are excited to welcome BBD's Investment Management Group to our team," said Cohen & Co. CEO Chris Bellamy in a statement Thursday. "They have long been a well-respected organization in our industry, and our mutual focus on client service and technical rigor makes this deal a perfect fit for both organizations. This addition reflects our continued commitment to exceed client expectations with deep industry knowledge and a strong team. We also look forward to becoming a part of the community in Philadelphia." 

All seven of BBD-IMG's partners will join Cohen, including managing partner Jim Kaiser, who will join the firm's board of managers. More than 40 audit and tax professionals will join the firm as part of the agreement, including seven partners. The total number of Cohen & Co. employees at the close of the transaction in March will be 750. Cohen & Co. currently has 72 partners. Financial terms of the deal were not disclosed.

Cohen & Co. ranked No. 53 on Accounting Today's 2022 list of the Top 100 Firms, with $111.89 million in annual revenue. 

"In this dynamic environment, it's crucial to be proactive," said Kaiser in a statement. "The opportunity to join forces with a firm that shares so many of our values, goals and vision for the future is compelling. We are confident that the combined strength of our teams will create meaningful growth opportunities for current staff and will help to ensure that our clients continue to receive the high level of service they have come to expect from both firms. Added capacity and expertise will also continue to differentiate us in the market and will be a huge win for clients and for any new candidates looking to build a career in a great firm."

In 2017, Cohen & Co. merged in Arthur Bell, a firm in Baltimore, to create one of the largest accounting firms specializing in auditing mutual funds, ETFs, hedge funds and investment advisors.