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[June 19, 2014]
Accounting firm ParenteBeard in merger talks with Chicago firm [The Philadelphia Inquirer :: ]
(Philadelphia Inquirer (PA) Via Acquire Media NewsEdge) June 19--ParenteBeard, a Philadelphia-based accounting firm that employs nearly 1,000 CPAs and staff at offices across Pennsylvania, in the New York area, Baltimore and Dallas, has been in merger talks with Baker Tilly Virchow Krause L.L.P., a Chicago firm that employs 1,500, both firms confirmed Thursday when asked about about staff memos detailing the discussions.
The proposal would result in ParenteBeard being merged into the larger firm under the Chicago firm's name and leadership.
"We are currently involved in ongoing discussions with Baker Tilly, and we look forward to providing more detailed information as we advance the discussion and planning process, but we are not in a position to share additional information at this time," ParenteBeard chairman and chief executive officer Robert Ciaruffoli said in an e-mail.
Ciaruffoli is the Wilkes-Barre native who moved to Center City to lead ParenteBeard's expansion in recent years through a series of mergers sometimes followed by layoffs and partner departures. Small accounting firms have been consolidating into larger firms as the cost of accounting technology and regulatory compliance squeezes practicioners.
"We are involved in ongoing discussions," David Pendery, spokesman for Baker Tilly Virchow Krause, confirmed Thursday.
Both firms are affiliated with Baker Tilly International, a London-based network of more than 100 accounting firms worldwide that competes with the U.S. "Big Four" and other multinational networks. Jake Luskin, the Philadelphia-based North America director for Baker Tilly International, declined further comment beyond what the firms said.
ParenteBeard was the 24th largest U.S. accounting firm, with revenues of $158 million for fiscal 2014, according to the industry periodical Accounting Today. Parente was one of three firms among the top 25 that reported a drop in business from 2013, when it ranked 21st.
Baker Tilly Virchow Krause was ranked 17th for 2014, with billings of $301 million.
A memo sent to ParenteBeard staff assured members that there is "minimal overlap" between Baker Tilly Virchow Krause's Midwestern office network and ParenteBeard's "Northeast Corridor" focus.
"A larger firm would increase our ability to attract mergers in other markets," the memo said, and create the biggest firm within the global Baker Tilly network, which reported sales of more than $3 billion last year, almost half of that in the U.S.
A separate note from Ciaruffoli to "ParenteBeard Team Members" said the combination would be the 12th largest acounting firm in the U.S., with offices in 28 cities. It directed employees with questions to firm president Jeff Ferro and other senior managers.
JoeD@phillynews.com 215-854-5194 @PhillyJoeD www.inquirer.com/phillydeals ___ (c)2014 The Philadelphia Inquirer Visit The Philadelphia Inquirer at www.philly.com Distributed by MCT Information Services
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