Big Four firms EY and PwC have closed two acquisitions in Belgium: EY has acquired A-THREE, a consulting firm specialised in preventing ’revenue leakage’, while rival PwC has snapped up Handson & Partners, a tax compliance and accounting services provider.
PwC and Handson & Partners
Handson & Partners was founded in 2002 (the firm has roots in one of the large audit and consultancy firms) and has since grown to a team of 80 professionals, generating revenues of around €9 million. The company offers a broad spectrum of services in two key areas: a wide range of staffing services with people with an accounting and financial background; and a local accounting practice – often called a ‘fiduciary practice’. Handson & Partners works predominantly for family owned businesses and start-ups.
With the acquisition, PwC grows its footprint in the segment for small and mid-sized enterprises, an area which it traditionally has less visibility in. “PwC has for too long been seen by some companies as a service provider solely for big multinationals. We believe that a significant part of the growth in Belgium will come from the dynamism of family owned businesses and start-ups, and we’re committed to helping these businesses succeed in their ambitions. What we were missing in Belgium is a price effective ‘hands on’ offering to our local clients. With Handson & Partners we now have a very competitive service offering for that segment,” says Philippe Vyncke, National Market Leader at PwC Belgium.
The move follows a range of initiatives already taken to intensify its ties with SME’s, including the opening of a new office in Hasselt last year, with another hub to open in Charleroi in the weeks to come, as well as support committed to several start-up (e.g. accelerators, incubators) and scale-up initiatives in the country.
Peter Van Rooy, Managing Partner at Handson & Partners, says he is delighted to be joining forces with PwC. “Being part of the PwC network will create a range of opportunities and access to knowledge and services for our clients and employees that we would not have had, had we remained an independent organisation.”
Handson & Partners will operate as a 100% subsidiary of PwC but not be fully integrated into the firm's organisation. “We will continue to be run as a stand-alone business within the PwC network and continue to work from our office in Antwerpen,” comments Van Rooy.
EY and A-THREE
A-THREE was founded in 2010 by Ludwig Bollaerts and Steve Van der Steen, and in recent years has grown into one of Belgium's leading start-ups in the area of ‘revenue leakage’ – the firm specialises in detecting, recovering and preventing the phenomenon. According to a recent study in the country, despite regular controls by in-house financial departments, automated ERP systems, strict internal and external audits, companies – regardless of size or sector – are faced with ‘leakage’ through which revenue simply ‘evaporates’. The researchers found that between 1% to 5% of gross profit of Belgian corporates slips unnoticed through their fingers, a feat which comes with a hefty price tag: up to an estimated €2 billion in gross profit is said to be lost within the premises of the country’s top 500 enterprises.
The deal, according to Rudi Braes, CEO and Chairman of EY Belgium, underlines the firm’s strategy to selectively invest in specific niche areas that have immediate added value for the client. “This acquisition will allow us to continue to meet the increasing demand from our clients in this specific niche domain. Having many competencies in house increases the quality of our services.”
As part of the deal, A-THREE will be integrated into EY and operate under the Big Four’s brand. Founders Bollaerts and Van der Steen will both become directors at EY. Under the helm of EY the A-THREE team will seek to expand its offerings. To date the startup consultancy had a strong focus on the consumer goods sector, by leveraging EY’s network Van der Steen expects to expand into other sectors. “We forecast increasing demand for our services. In addition to traditional demand from telco, distribution and retail, requests for revenue leakage screening will also come from other major sectors. The government and for example major cities are now also requesting such services.”
Bollaerts adds: “The integration with EY also offers more growth opportunities for our employees.”