Register to get free articles
Want unlimited access? View Plans
Already have an account? Sign in
Baker Tilly has agreed to sell a majority stake in the investment groups Hellman and Friedman and Valeas, the Financial Times has reported.
The sale, which marks the largest private equity deal to date in the industry, will give the firm’s US business an enterprise value of more than $2bn (£1.5bn) and capital to fund an “extremely aggressive” acquisition strategy.
It is understood that the firm has ambitions to challenge mid-tier accounting firms outside the Big Four, such as RSM, Grant Thornton and BDO.
H&F’s investment also represents a return to large-scale dealmaking in the US accounting industry, following a hiatus caused by rising interest rates.
A person familiar with the deal told the Financial Times that two private equity firms would take an equity stake of roughly $1bn (£800m) for just over 50% of the firm, with more than $900m (£717m) coming from H&F.
There will also be an undisclosed amount of debt financing provided by a group of private lenders including Blackstone Credit, HPS Investment Partners and Blue Owl Capital.
H&F has previously invested in advertising agencies, advisory firms and insurance brokerages. As with Baker Tilly, H&F’s investments are often the first external capital to come into closely-held partnerships.
US accounting firms have been considering private equity deals for several years, as they are enticed by the ability to put an equity value on a firm that has historically paid out most of its earnings to partners.
