Chicago (May 28, 2004) -- Midwest powerhouse Virchow Krause & Co. has waded into the Windy City market, merging with KGN Financial Group, a 12-partner firm generating annual revenues of $12 million.
The merger, scheduled to be completed in June, will swell the ranks of Madison, Wis.-based VK to 950 employees with annual revenues of roughly $120 million and adds Chicago to its Midwestern-based roster of offices, which currently includes Milwaukee, Minneapolis and Detroit.
Upon the completion of the merger, KGN will operate under the Virchow Krause brand, while KGN managing partner Steve Levin will oversee the Chicago office. He also will become a member of VK’s executive committee.
“Strategically, we weren’t planning on merging,” Levin told WebCPA. “But we talked with them for 16 months. The first part of our discussions centered on just culture and if there was a fit before we got into the financials. We now have access to their expertise. There are 500-600 (VK) people within a 150-mile radius of Chicago.”
The VK-KGN merger is the latest in a series of deals that are quickly swallowing up local Chicago firms. Southfield, Mich.-based Plante & Moran recently absorbed Chicago-area Gleeson, Sklar, Sawyers & Cumpata.
“This is part of the Chicago phenomenon,” said Allan Koltin, chief executive of Chicago-based PDI Global, who brokered the merger. “Half of the largest 25 firms in the city have been merged upstream. That, combined with the collapse of Andersen and the passage of Sarbanes-Oxley have made large private companies and smaller public ones more willing to talk with firms other than the Big Four.”
Virchow Krause ranked No. 18 on Accounting Today’s 2004 Top 100 Firms list with $104.1 million in annual revenue.
-- Bill Carlino
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