M&A roundup: Deals from coast to coast

June 29, 2022 1:40 PM

Moss Adams merged in Mengali Accountancy and Sousa & Weber; Dean Dorton added Koonce, Wooten & Haywood; CapinCrouse acquired the Global Center for Nonprofit Excellence; Avantax bought the Jeffrey Steinberg wealth management practice; and K1X acquired Crowe Tax Technology product line.

CALIFORNIA: Moss Adams merges in Mengali Accountancy and Sousa & Weber

Moss Adams offices in Seattle

Sean Airhart

Details: Moss Adams LLP, a Top 20 Firm based in Seattle, expanded in California with two mergers: Mengali Accountancy Inc. in Healdsburg and Sousa & Weber in Los Angeles.

The combination with Mengali was announced Wednesday and will take effect Aug. 1. Mengali Accountancy is a boutique consulting firm that specializes in the real estate industry. As part of the deal, its founder and president, Renee Mengali, along with principals Debbie Warren and Keith Hollander, will join Moss Adams. Financial terms of the deals were not disclosed. Mengali has 46 employees, who will all be joining the Moss Adams team. Moss Adams has more than 3,800 employees and over 350 partners. Moss Adams ranked No. 12 on Accounting Today’s 2022 list of the Top 100 Firms, with $954.53 million in annual revenue.

“I take great pride in strategically aligning with Moss Adams since we’ve worked together for many years, and we mutually respect one another. It’s an easy choice and transition for us,” said Renee Mengali in a statement. “We value the new growth opportunities on the horizon for our team, knowing that through this combination with Moss Adams, we will have an array of broader consulting services to offer our clients.”

Last week, Moss Adams announced a combination with Sousa & Weber, a public accounting, tax and business advisory firm. That deal also takes effect Aug. 1, 2022, when eight professionals from Sousa & Weber, including its two founding partners, will join Moss Adams.

“Moss Adams has seen solid growth in Southern California and across our key markets,” said Moss Adams chairman and CEO Eric Miles in a statement. “We continue to evaluate areas of focus where our clients need and want us to be. This combination, and the addition of their talented professionals, falls in line with that core strategy.”

“By aligning with Moss Adams, we’ll strengthen our focus on the things that matter to our clients while continuing to provide expanded business advisory capabilities,” said Rich Weber, a partner with Sousa & Weber, in a statement.

“Rich and I took our time looking for the right fit for our employees and clients,” said Sousa & Weber partner Ken Sousa in a statement. “It was important to both of us to find a firm that values and empowers employees to thrive long-term.”

Last June, Moss Adams merged in the Candace Group, a risk management advisory firm in Salt Lake City, Utah.

NORTH CAROLINA: Dean Dorton adds Koonce, Wooten & Haywood

Details: Dean Dorton Allen Ford PLLC continued its expansion in North Carolina with the merger of Koonce, Wooten & Haywood, LLP, a longtime CPA and advisory firm based in Raleigh.

Dean Dorton, based in Lexington, Kentucky, already has more than 325 employees across its three offices in North Carolina and Kentucky. KWH comes after Dean Dorton’s previous Raleigh mergers of Massey Consulting and Penny Longobardo and Co. The merger will take effect July 1, 2022, and the combined firm will operate as Dean Dorton.

“The merger with Koonce, Wooten, & Haywood helps us better serve our growing practice in Raleigh and expand professional advisory services to many companies,” said Dean Dorton president and CEO David Bundy in a statement Wednesday. “We are excited about continuing the high level of service and expertise KWH has provided its notable client base while bringing additional services to the market such as outsourced accounting, data analytics, cybersecurity, health care consulting services and much more.”

Financial terms of the deal were not disclosed. The combined revenue for the firms are expected to exceed $62 million. Dean Dorton ranked No. 11 on Accounting Today’s 2022 Regional Leaders list of the Top Firms in the Southeast, with $42.32 million in annual revenue.

“Koonce, Wooten & Haywood has enjoyed serving clients throughout North Carolina for more than 70 years,” said KWH managing partner Graham Clements in a statement. “As we looked toward the future, we realized we wanted to provide our clients with a variety of services outside of traditional accounting and expertise that is truly invaluable. Dean Dorton is the perfect match for us to team up with to continue providing high-quality service efficiently and effectively while providing clients with additional value through a broader range of specialty capabilities, advice, and solutions. In addition, we want to offer more opportunities for our employees and referral partners who are the backbone of our business.”

Last July, Dean Dorton acquired Breakpoint Technology, a data analytics and technology collaboration practice in Louisville.

INDIANA: CapinCrouse acquires Global Center for Nonprofit Excellence

Details: CapinCrouse LLP, an Indianapolis-based firm that focuses on serving faith-based nonprofit organizations, acquired the Global Center for Nonprofit Excellence, effective June 22.

The Center’s mission is to help nonprofits, funders and industry experts work better together to make the greatest impact. The Center’s OpX360 online assessment tool helps nonprofits identify operational competency levels and provides recommendations for excellence in six key areas of operations. Other services include objective executive review and oversight, fundraising audits, third-party monitoring, free referrals of prequalified industry experts, and other information important to the success of nonprofit organizations.

Financial details of the deals were not disclosed. CapinCrouse is a $30 million firm. It ranked No. 27 on Accounting Today’s 2022 Regional Leaders list for the Top Firms in the Great Lakes region. The Center for Global Excellence’s revenue was not disclosed. CapinCrouse has 30 partners and 150 staff members. The Center is led by Robert Lipps and Marc Stein, co-founders and principal advisors, and has one additional staff member.

“We are very pleased to welcome the Center to CapinCrouse,” said CapinCrouse managing partner Fran Brown in a statement Tuesday. “Nonprofit organizations today face growing challenges as well as opportunities and need insightful advice and guidance. The Center’s vision and focus on helping nonprofits achieve operational excellence is an exceptional fit and aligns with our firm’s mission of providing innovative service to organizations whose outcomes are measured in lives changed.”

Lipps and Stein will remain in their current roles after the acquisition. “We are excited to join CapinCrouse, a firm that shares our commitment to serving nonprofit organizations and helping them maximize their results,” Lipps said in a statement. “We look forward to what the future holds for the Center and CapinCrouse as we continue our focus on helping nonprofits increase their operational efficiency and providing a network of best-in-class nonprofits, funders, and industry experts to develop and promote best practices across nonprofit organizations.”

FLORIDA: Avantax buys Steinberg wealth management practice

Details: Avantax, a tax-oriented financial planning firm, has acquired the Port Saint Lucie-based wealth management practice of Jeffrey Steinberg, which had approximately $157 million in assets under management as of May 30.

Steinberg is moving from affiliation with KPS Wealth Management LLC, to partnership at Avantax Planning Partners, where he will be the registered investment advisory firm’s first branded practice in Florida.

Steinberg will join another new Avantax partner, Sandeep Varma of ATS Advanced Trustee Strategies, who affiliated his $400 million practice earlier this month with Avantax.

“I’ve spent 20 years building my practice as one advisor, and I wanted to make sure I had a plan in place to protect my business and the people most important to me — my family, my clients and my assistant of 17 years,” Steinberg said in a statement Tuesday. “I achieved that with Avantax Planning Partners, and I’m excited to leverage their resources. The Avantax team has been so genuine, professional and kind throughout this process. I feel great about this for my clients because there’s no impact on them; they’re still going to have their account at Avantax, their investments aren’t changing, they’ll still come to my office, and when they call, my assistant will answer like always. It’s exactly what I wanted.”

“Jeff took a thoughtful approach to this transaction, and because Avantax is so flexible, we created a structure supporting a more predictable future for his clients and his family while positioning Jeff for more growth,” said Todd Mackay, president of Avantax Wealth Management, in a statement. “Financial professionals who plan their own financial future as well as their clients’ are doing themselves a wonderful service. It’s incredibly rewarding to see Avantax and financial professionals like Jeff working together to plan for the future while staying focused on client service, growth and what’s best for the financial professional and their loved ones.”

Last November, Avantax acquired Warner Finance, a Pennsylvania-based firm with approximately $258 million in total client assets.

The deal comes on the heels of Avantax’s acquisition of New Jersey-based Headquarters Advisory Group LLC, which closed on Aug. 26, 2021. Avantax Wealth Management and Avantax Planning Partners are part of the wealth management segment of Blucora, Inc., a public company with a collective $88 billion in total client assets as of June 30, 2021. In 2019, Blucora combined HD Vest with 1st Global to create Avantax Wealth Management (see story).

ILLINOIS: K1X acquires Crowe Tax Technology product line

Details: Crowe LLP, a Top 10 Firm based in Chicago, has sold divested three of its Crowe Tax Technology products, C-TRAC, K-1 Analyzer, K-1 Navigator, selling them off to K1X Inc., a venture-backed firm owned by Mudita Venture Partners and Geralyn Hurd, a former Crowe Tax Technology partner.

Financial terms of the deal were not disclosed. Crowe ranked No. 9 on Accounting Today’s 2022 list of the Top 100 Firms, with $998.7 million in annual revenue.

“At Crowe, we thrive on our ability to identify client needs in this highly-complex tax landscape and build technology-enabled solutions to address those needs,” said Crowe Tax managing partner Niki Bencik in a statement Wednesday. “C-TRAC, K-1 Analyzer and K-1 Navigator are clear manifestations of that Crowe mindset, and we’ve built innovative solutions that are of interest to the venture investment community. We have incubated and grown this suite of solutions, and view this as a good moment in time to sell these assets to a company that will make the needed investments to scale the solutions further while allowing us to continue investing in other areas to bring innovative solutions to our clients.”

Along with purchasing the Crowe technology assets, K1X Inc. will offer employment to the approximately 40 Crowe tax technology professionals who work on and are responsible for programming the C-TRAC, K-1 Analyzer and K-1 Navigator products. The transition is expected to be substantially complete by the end of this year.

“I’m proud of what we were able to build and incubate at Crowe with these technologies, and I’m excited to move forward in expanding these capabilities and aggressively bringing them to market in my new role,” Hurd said in a statement. “We have a strong team that is dedicated to scaling these solutions in a market that is demanding stronger digital tools to solve complex problems.”