BDO Stoy Hayward and Moores Rowland have agreed to merge at the beginning of March in a move that will intensify pressure on other Group A firms to seek alliances.
The agreement to join forces marks the biggest merger of two top-20 firms outside the Big Five eclipsing last year’s merger of Casson Beckman’s London offices with Baker Tilly. Ten of Moores Rowland’s 14 offices will merge with the Stoys network, creating the UK’s sixth largest practice with fee income of #150m from a network of 45 offices.
The Moores Rowland name will eventually be subsumed, but it is unclear how quickly.
Stoys managing partner Adrian Martin said the new firm would be able to capitalise on its synergies.
‘Everything that we do is focused on the entrepren-eurially managed growing business and, as the two sides started talking, we found that we had a similar view of clients, while also having synergies in the geographical locations of our offices,’ he said.
The enlarged base of 133 partners, with around 65 of them based in the core M25 region, will mean Stoys can provide more specialist skills in each office such as corporate finance and tax experts, he said. Stoys has pledged to invest around #7m in IT.
No changes will be made to the Stoys management. Moores Rowland managing partner Clive Weeks will become part of the new management executive, which will oversee the practical details of the merger. He will remain in a senior management role when the merger is complete. Stoys senior partner and English ICA president Chris Swinson will remain a senior partner.
Moores Rowland abandoned merger talks with fellow Group A firm Kidsons Impey late last year. A wave of consolidations among mid-tier firms had been expected to follow a successful merger. Weeks said this week his firm had long held an objective of forming an alliance. He said talks with Kidsons failed because of a lack of cultural understanding.
The Scottish and Manchester offices of Moores Rowland will not be joining in the merger plans and will be shortly announcing separate arrangements.
Industry insiders now expect merger attention to focus on the likes of Kidsons, Pannell Kerr Forster and Grant Thornton.
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