Plante Moran's Latest Merger Ups It to Eleventh Place National Ranking
by Terri Eyden on
By Frank Byrt
Plante Moran's merger with a Chicago CPA firm last year moved it up a notch to eleventh place in a ranking of the nation's largest public accounting firms based on revenue and significantly expanded its Chicago presence.
Plante Moran PLLC now has a staff of more than 2,000 professionals in twenty-one offices throughout Michigan, Ohio, and Illinois and three offices internationally.
Gordon Krater, Plante Moran's managing partner in Southfield, Michigan, since 2009, told AccountingWEB in an interview that his firm's July 1, 2012, merger with the Chicago CPA firm of Blackman Kallick was intended to expand Plante Moran's presence in the Windy City and to offer more types of services for Blackman Kallick's clients.
Plante Moran's focus is on providing audit, tax, and financial advisory services to manufacturing, health care, real estate, construction, retail, and technology companies in the private sector as well as audit services to education and government organizations in the public sector.
Plante Moran also provides wealth management services to business clients' 401(k) pension plans and to high-net-worth individuals. At September 20, 2012, it had about $10 billion in assets under supervision and about $8 billion under management.
Blackman Kallick, which brought 250 staffers to the merger, adopted Plante Moran's name as of January 1, 2013, and the merged firm is now the seventh largest accounting firm in Chicago, with three offices serving more than 5,000 clients.
Blackman Kallick focused primarily on audit and tax services, and its motivation for the merger was to tap into Plante Moran's range of management advisory services. "That was of great appeal to them as they were finding that they couldn't provide all those services to their clients," said Krater.
"This was a merger of two very strong firms," he said. "They didn't have successor issues or people who wanted someone to buy the business out. We decided we'd be better together than apart."
Plante Moran's net revenue for its fiscal year ending June 30, 2012, pre-merger, was $331 million. That put it in eleventh place in a ranking of the nation's CPA firms by revenue by Inside Public Accounting. The combined revenue for both firms in 2011 was approximately $375 million.
As part of the merger discussions, the firms concluded that they have similar cultural views and outlooks, a catalyst to the deal. "We have the same vision, but maybe we were at different points on the road to that vision," Kater said.
"We have a world-class culture," said Krater, as exemplified by the firm being ranked on FORTUNE magazine's 2013 list of "100 Best Companies to Work For" for the fifteenth consecutive year, which greatly appealed to the partners at Blackman Kallick.
But there are always challenges as a result of any merger, including synchronizing systems, processes, and approaches to audits, he said. "But it's been more evolution instead of revolution."
The merged firm now has more than 268 partners. "All of their partners came over as partners (to the merged firm), and several are part of our governance committees," said Krater. "Some of the attraction for their younger partners is that there are more leadership opportunities in the combined firm than in a smaller one.
"We try to learn from every merger," Krater said. After a merger with a Cincinnati firm three years ago, the management teams met to discuss what could have been done better. "We got really good feedback and we learned from it, and this merger has gone smoother because of that," he said.