BDO USA LLP has added Goldstein Schechter Koch, expanding the firm’s presence in South Florida in the latest of a string of mergers across the country.
The deal will add 14 partners, 100 staff members, two offices in Fort Lauderdale and Coral Gables, and approximately $22 million in revenue to BDO. The firm recently announced revenues of $1.29 billion in fiscal year 2016 (see BDO Boosts Annual Revenue 22.9%). BDO, based in Chicago, ranked 7th on Accounting Today’s 2016 list of the Top 100 Firms.
GSK’s two offices in South Florida will join BDO's existing offices in Lakeland, Miami, Orlando, Tampa, West Palm Beach and Winter Haven, Fla. Altogether BDO will have more than 300 professionals serving clients in the Sunshine State. The deal is expected to close August 16.
GSK dates back to 1949 and offers accounting, tax and wealth advisory services. Its GSK Wealth Advisors unit provides portfolio management services and investment strategies for clients. GSK has worked with BDO as part of the BDO Alliance for a dozen years.
“For us, the relationship started when they joined our alliance program in 2004,” said BDO USA CEO Wayne Berson in an interview Thursday. “They were a natural firm for us to talk to. We’ve been very familiar with one another for over a decade now, and we’ve enjoyed our interactions over the years. We’ve worked together in many different ways. Their location in Coral Gables and Fort Lauderdale, combined with our existing practices in Miami and West Palm Beach, nicely rounds out our footprint in the important South Florida markets. Plus, when you add on their strength in the wealth advisory area, this is also a nice fit for our growing wealth advisory practice. There are a lot of synergies amongst the two firms.”
Members of GSK have attended BDO training sessions over the years, he pointed out, plus the two firms use similar software and send referrals to one another.
GSK CEO Sanford Horowitz said his firm has been frequently approached by other regional and national firms over the years about doing a combination, but he was impressed by BDO. “When they approached us many months ago to tell us what they’ve been doing and update us on their expansions over the last four years and just what their overall approach and philosophy was, we were very impressed,” he told Accounting Today. “Although we had some conversations with them about 10 years ago, we weren’t ready for it and it didn’t have the same level of direction and focus the way it was directed and focused now, so that’s what it made it very attractive to us.”
GSK plans to retain its existing offices in Fort Lauderdale, but will eventually relocate the staff from its Coral Gables office to BDO’s nearby offices in Miami. After a firm-wide meeting on Tuesday, Horowitz sent personal emails to each staff member the following morning to reassure them about the changes, and he has heard positive feedback so far.
“I assured them about how comfortable we are about this and I assured them about the transition,” said Horowitz. “I recognized that they might be a little bit nervous and I recognized that they’re probably a little bit excited. That took me about six or seven hours, but I felt that I wanted to send a message that it’s all about them, and they really appreciated it.”
In the past four years, BDO has gone through a series of 19 mergers, entering 23 new cities and expanding its footprint in 12 existing markets while adding more than 2,000 staff.
The latest deal builds upon a merger last year where BDO entered the wealth advisory space. As part of BDO’s strategic expansion plan, BDO is continuing to have discussions with numerous firms around the country to expand both its geographic footprint and talent.
“From a geographic standpoint we’ve added a great deal to our presence in the Central and the Atlantic regions and now we’ve begun to add to our critical mass in the Southeast region,” said Berson. “Beyond geography, we are looking to add resources in areas of growing demand. When you look at private client services, wealth management, transaction advisory, outsourcing, cybersecurity, data analytics, risk advisory and actuarial services, these are all areas we’re looking at. If we find a firm that has talent in these areas and expertise, we would certainly talk to them.”
While several deals are in the works, he is unsure if they will close before the end of the year. “The further you get into the year, the harder it is to do a deal,” he noted.
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