Why Accounting Firm Merger Talks Fail

Source: Practical Accountant

Allan Koltin (CEO, PDI Global) writes that 90 percent of all merger discussions fail. The acquiring firm wants an ideal combination. He gives an example of a six-partner firm that had two high-level partners favoring a merger to enhance profits, growth, and job gratification. Two unproductive partners felt threatened by the merger. In fact the two high-production partners were earning less than their input because of the two unproductive partners (who felt entitled to a larger than commensurate share of earnings because they had partner titles). The two other partners voted against the merger out of loyalty to the low-producing partners.

To make mergers work, there has to be a creative approach that deals with each partner's reservations.

For the complete article, click here and select "Some Take-Aways From 2008 M&A Activity, With a Look to 2009" in the June 2009 issue.

From Practical Accountant, June 2009, SourceMedia Inc., One State Street Plaza, 27th Floor, New York, NY 10004, 800-221-1809.

Note: This is the final issue of Practical Accountant