Virchow Krause Eyes More Midwest Mergers
The management of Madison, Wisconsin, based Virchow Krause & Co., one of the accounting profession’s 20 largest firms, is busy gobbling up small chunks of the Midwest’s accounting market and has an appetite for more.
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The regional giant, with $150 million in 2005 revenues, has disclosed the pending acquisition of William F. Gurrie & Co., a 40-staffer Certified Public Accounting (CPA) firm with a reported $5 million in revenue, in Oak Brook, Illinois, near Chicago. In early April, Virchow announced a merger with Kleiman Carney & Greenbaum, a 53-person, $7.5 million Detroit area firm.
The latest deal, expected to be finalized in June, is part of a much larger plan for the Chicago area. “Chicago is a very important market for us and center of attention for growth," Tim Christen, chief executive officer of Virchow Krause, told Crain’s Chicago Business, which first reported the Gurrie deal.
Steve Levin, Chicago market managing partner, added that Virchow Krause plans to make more acquisitions in Greater Chicago and will have as many as 400 employees in the city and its suburbs within three years. When the Gurrie & Co. transaction is completed next month, Virchow will have a total of about 150 employees in the market; it last expanded there just about a year ago when it acquired the KGN Financial Group.
Tim Cole, president of Gurrie & Co., has said that he expects the merger to improve his company's service capabilities and ability to recruit talent. “This is a competitive market for personnel. This helps us compete for the brightest people,” he told Crain’s Chicago Business.
The latest Chicago deal will also beef up Virchow’s presence in the public sector of nonprofit and government organizations, one of the principal practice areas for Gurrie & Co. “Their (Gurrie's) depth of knowledge and expertise in providing services to this market segment is a great complement to our firm’s growing public sector practice,” Chuck Cedergren, managing partner of Virchow Krause’s public sector practice, told the Chicago news report.
Just about a year ago, Virchow Krause expanded its public sector service breadth by joining the reseller channel of Blackbaud, a specialist developer of accounting and management software for that sector.
The regional firm’s business and merger strategies for the Detroit and Chicago markets are very similar – big overall growth in incremental chunks. The Kleiman, Carney & Greenbaum merger, also expected to be completed next month, will give Virchow Krause a total of 170 employees in metropolitan Detroit,
After merging with Detroit area-based Zalenko & Associates in 2005, Christen stated that Virchow Krause’s goal was to have more than 200 employees in Detroit by 2007.
The chief executive has also said he plans to consolidate the firm’s three Detroit area offices, which include sites in Bingham Farms and Southfield, into a consolidated location. The firm’s plans for its Chicago area locations have not been disclosed.
The Kleiman deal expands Virchow Krause’s presence in the public entities real estate, wholesale and distribution niches, Christen said.
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