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BDO UK is in advanced merger talks with its sister firm in Ireland, as the world’s fifth-largest accounting network by revenue pushes for regional consolidation.
The two firms are concluding discussions but are still awaiting a partner vote and regulatory approval. The business would have annual revenues close to £1.1bn and combine the Irish offices in Dublin and Limerick with the UK firm’s 18 sites.
Like many peers, BDO is a network of partnerships that are separately owned and managed by the senior practitioners in each country, overseen by a global umbrella body.
The merger would mark a shift for the UK firm as its network explores external investment options that would help its member firms consolidate in regional groups.
Mark Shaw, managing partner at BDO UK, said its mid-market clients were increasingly seeking support on a range of cross-border issues: “It makes sense that we look at ways to collaborate even more closely with our international colleagues, hence this proposed merger.”
Brian McEnery, managing partner at BDO Ireland, called it a “logical step”.
The enlarged firm would have 542 partners and 8,500 employees and remain part of the BDO International network, which has almost 120,000 staff in 1,800 offices.
Many accountants, including Big Four firms, have in recent years sought to merge smaller country-based firms to build scale via more regional businesses.
Mid-tier and smaller firms are increasingly doing so by tapping private equity groups, which have been scouring the sector for investment opportunities.
BDO’s close rival Grant Thornton sold a stake in its UK business to Cinven last year — followed by a slew of other similar deals across the sector — and has since used the private equity backing to bid for stakes in its German and Singaporean sister firms.
BDO will not have similar backing, but its merger campaign includes promising partners increased investment in the firms and opportunities for working across the firm internationally. The push for consolidation is a response to clients increasingly seeking cross-border advice.
An informal group of senior partners is in the meantime conducting research for BDO’s global umbrella body on taking external investment, including member groups taking on debt financing from a private credit firm or selling stakes to private equity investors.
