Plante Moran to merge in Denver’s EKS&H
Top 15 Firm Plante Moran and Top 100 Firm EKS&H have agreed to merge, effective Oct. 1.
The two are the largest independent firms in their respective regions – Plante Moran primarily in the Great Lakes area, and EKS&H in the Mountain Region – and the combined firm expects to be the 11th largest in the country, with over 3,000 professionals in 27 offices. Plante ranked No. 15 on Accounting Today’s Top 100 Firms list, with $520.8 million in 2017 revenue, while Denver-based EKS&H ranked No. 41, with $105.9 million.
EKS&H, which also has offices in Boulder and Ft. Collins, Colorado, was founded in 1978, and has more than 60 partners, over 300 CPAs, and more than 750 staff overall. It provides audit, tax, technology, wealth advisory, and business consulting services to public and private clients locally, nationally and internationally, with focuses that include energy, high tech and transportation.
The combination is the first of any size for some time for Plante Moran. “Our last large merger was with Blackman Kallick in Chicago in 2012,” said PM managing partner Jim Proppe. “We like to find the biggest firm in the market, bring them into the firm, and make sure they’re well integrated before we move on to the next.”
“We’re always talking to firms, so that’ll continue, but we’ll make sure EKS&H is well-integrated before we look to the next one, and that will be something we’ll together,” he added. “We don’t have anything going with other firms right now – we as Plante Moran have identified markets we want to be in, but we’ll go over this with Bob [Hottman] and his team at EKS&H to make sure we’re on the same page in terms of where we want to expand.”
The firms began talking last October – but the original purpose of the discussion was not a merger.
“We had never even contemplated merging up with anybody,” explained EKS&H CEO Bob Hottman. “As a firm, we were going through and developing our strategic plan for the past several years. One of the things we wanted to do was to talk to a firm that was much bigger than ours and that had taken the steps we wanted to take.”
In particular, EKS&H wanted to expand its private equity relationships, to make sure it had the technology it needed for the future, to develop processes for innovation, and to keep abreast of client needs for geographic and international expansion.
The firm identified 25 firms that it could learn from, and quickly narrowed those down to Plante Moran; EKS&H already knew the larger firm’s culture was compatible with its own, and thought that PM’s track record of innovation and adding new service lines matched what it wanted for its own future.
“We approached Plante Moran originally to learn from them, and the more we talked, the more we refined our strategic plan to align us with what Plante Moran had done, and then it dawned on us that we could grow it ourselves, or we talk to Plante Moran about joining forces and accelerating our growth by 15 to 20 years,” said Hottman. “The discussion went from talking about what Plante Moran does, to talking about combining.”
The larger firm, meanwhile, already had its eye on EKS&H’s home market. “While EKS&H was looking at becoming a firm of future, we were looking at our strategy relating to geography,” said Plante Moran managing partner Jim Proppe. “We don’t do a lot of mergers, and we’re very particular about finding the right firms and right markets. … We have several national practices, and had identified Denver as one of the top markets. Once we started talking, it moved pretty quickly from alignment of culture to what makes business sense.”
“This was either two firms coming together by coincidence or by fate,” added Hottman. “I believe this will be the national culture-based firm in our profession.”