The State of the M&A Market

The State of the M&A Market

The deals just keep coming

Each year for the past decade, the appetite for mergers and acquisitions in the accounting space has outpaced the previous year – and 2015 was no exception. What’s more, the market continues to shift in unexpected ways, as the supply of buyers and sellers changes, along with what they hope to accomplish in individual deals.

To help map out the M&A landscape for the year ahead, we asked a number of experts in the field to share their thoughts on what 2016 will hold for firms looking to combine. Our “virtual roundtable” included Steven Berger, a shareholder at law firm Vedder Price; Allan Koltin, CEO of Koltin Consulting Group; Ronald Loberfeld, managing partner of Abrams Little-Gill Loberfeld; Jay Nisberg, of Jay Nisberg & Associates; Russell Shapiro, a member of the Corporate & Securities Group at law firm Levenfeld Pearlstein LLC; and Joel Sinkin, president of Transition Advisors.

How would you characterize the M&A market?

Shapiro: The market continues to be robust. Acquirers want to keep growing and expanding into new markets to leverage their infrastructure. Smaller and local firms continue to view merging as a way to fund retirement benefits, gain ability to service larger clients and gain access to better technology platforms. The pickings are getting slimmer, however, and while I do not see any ebbing in merger activity for the time being, I wonder how much longer it will last. Many larger firms are willing to absorb smaller firms with smaller clients than in the past. It is an open question in my mind as to whether the smaller clients will be retained. There may be more activity among the Top 100 Firms.

Sinkin: The market is very active and will remain so for the foreseeable future. There are many reasons for this activity but the main ones include: succession; large firms seeking to enter new marketplaces; large firms who recently did enter a new marketplace now looking into tuck-ins; talent grabs; and establishing cross-selling opportunities by merging in niches and the like including nontraditional accounting and tax firms.   Read more on Accounting Today.