Centerprise rebrands itself: UHY Advisors seeks niche in middle-market

By Bill Carlino

Chicago — Taking a leap towards a strategy of fusing into one national operating model, accounting firm consolidator Centerprise Advisors has rechristened itself UHY Advisors Inc. and has targeted middle-market companies as a lucrative client pool for its services offerings.

“We wanted a broader and stronger platform to go to market with,” explained UHY president and chief executive James B. McGuire. “We have five highly regarded firms, each with very reputable leaders in their local markets. They all spent a considerable amount of time with me trying to strategize about the future and get a clearer vision about where we’re headed.”

The brand change became effective July 13.

UHY Advisors, which, as Centerprise, ranked No. 16 on Accounting Today’s 2004 Top 100 Firms list with annual revenues of $151.5 million, was formed in 2000 following the merger of Houston-based Mann Frankfort Stein & Lipp and four large regional firms. The consolidation was aided by a $250 million infusion of capital from private investors.

The firms that comprise UHY Advisors are MFS&L; Follmer Rudzewicz; Scillia Dowling & Natarelli; Grace & Co.; and Urbach Kahn & Werlin.

The five firms will subsequently operate under the UHY Advisors brand.

Centerprise was one of several “roll-up” firms, a roster that included American Express Tax & Business Services, Century Business Services and H&R Block.

However, after early promise, the consolidator concept has faltered over the past several years, with most entrants shutting down their M&A engines entirely, or making smaller acquisitions.

 “In some broad stroke, the roll-up model has come to a streaking halt,” said noted consultant Allan Koltin, chief executive of Chicago-based PDI Global. “If you look at the vision [firm consolidators] had five years ago, clearly that is not in line with reality today. They learned the hard way that it’s a people business, and at the end of the day, it does not have the ability to flip off exponential profits like the proverbial widget company.”

McGuire also revealed that UHY would form a limited liability partnership for its attest services offerings. In addition to its five core CPA firms, UHY also has two third-party insurance administrator firms, an insurance brokerage concern and a litigation support firm in its portfolio.

The UHY brand is predicated on 17-year-old Urbach Hacker Young International Ltd., a global organization of accounting and consulting firms with some 148 offices in 50 countries, founded by Urbach Kahn & Werlin and Hacker Young — New York and London-based firms, respectively.

“It’s been an elaborate process, but each of the leaders has been very supportive of what we’re trying to do. I owe a lot of credit to them,” said McGuire.

“[UHY] have come to the conclusion that if they show a national brand they’ll be able to play ball with the larger private companies and smaller public ones, and competitively pitch an account against the likes of a BDO Seidman and Grant Thornton,” said Koltin.

McGuire, who came aboard at Centerprise in August 2003, spoke of “redefining the business model,” and said that the firm would either add or redirect people into “growth areas.”

In May, UHY named Matt Camden, the former high-profile chief technology officer at the Peoria, Ill.-based firm of Clifton Gunderson, as the company’s inaugural chief information officer.

At the time of Camden’s appointment, the consolidator said that it intended to make technology consulting a global priority. “He’s the guy who’s going to lead the charge to integrate our infrastructure,” said McGuire.

As part of its brand-development effort, UHY formed a series of industry-specific teams targeting key sectors, such as construction, dealerships, education and not-for-profits, entertainment and sports, retail and distribution, and real estate, among others.

“We had done a market study of the larger competitors,” McGuire said. “We felt one of our prime attributes was a high level of professional service to clients. Some of the bigger firms were not serving the middle market as visibly as we were. So we created a brand and a tagline, ‘The Next Level of Service.’”

McGuire said that while UHY would focus on the middle market — a demographic comprised of roughly 300,000 companies — it ideally would parlay its new rebranding strategy to market its specialty services to larger corporations.

“Part of that strategy to fine-tune our middle-market focus is that it gives us an entrée, if you will, to the larger companies,” McGuire explained. “That’s a market for our non-attest services such as IT, forensic, litigation and valuation services.”

Prior to coming aboard Centerprise, McGuire served as executive vice president of BearingPoint — the former KPMG Consulting — and before that served as chief executive and vice chairman of both the U.S. and global consulting business at KPMG.

He succeeded Centerprise founder Bob Basten, who relinquished the chief executive role after being diagnosed with Lou Gehrig’s disease.

Currently, UHY Advisors has nearly 1,000 professionals in 20 offices across the country, including New York City, Boston, Washington, Los Angeles, Houston, Dallas and Detroit.

Said McGuire, “Over the past four years, we’ve become much more familiar with ourselves and our capabilities. This is part of our evolution, if you will. We’re in the process of hiring some high-level individuals and filling out some of our white space and footprint. I hope the market now understands that we’re one integrated firm.”

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