IS RSM TENON a good business?
Obviously Baker Tilly thinks so. Or at least one with potential.
Without having to carry RSM Tenon's full Lloyds debt burden on its own books, on the face of it the deal becomes more compelling. Indeed, the RSM Tenon executives have led a big restructuring at the business which saw it entering a period of relative operational stability.
It will be interesting to see whether RSM Tenon CEO Chris Merry considers the deal a ‘success'. It will certainly secure many people's jobs, but won't look too hot on his CV.
Let's not forget the long-suffering shareholders who are out of pocket.
While Merry and the other directors were unable to reconcile the debt issue with Lloyds, Baker Tilly has been able to swoop in. As Merry said to Accountancy Age on his appointment last year, "a people business is about confidence". Many of their partners, shareholders and financiers lost confidence.
And there is more dirty work to do, which will fall into Baker Tilly's lap.
RSM Tenon has been haemorrhaging partners, and Baker Tilly's intervention doesn't mean that process will end. Indeed, it will want to see if anyone's hanging around that needs ‘retiring'. And the cost of pushing people out of the door, looking at office mergers and bringing together back-office functions and systems is painful.
Ask Grant Thornton about its post-RSM Robson Rhodes shenanigans.
And, speaking of RSM, the international network faces another search for a UK incumbent.
UK mid-tier firms face succession planning issues, a stagnant market with too many players, plus big and small firms encroaching into their space.
It has been predicted for many years, but now the time has come for change. The BDO/PKF and Baker Tilly/RSM Tenon deals will not be the last.
Firms will live, and firms will die. But at least things will be different.
Kevin Reed is editor of Accountancy Age and Financial Director
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