Azets continues buy-and-build growth strategy in 2023

SME-focused accounting and advisory firm Azets has completed a string of deals in 2023 so far, continuing its multi-year buy-and-build strategy. The latest sees the firm sell a minority share to private equity organisation PAI Partners, whose investment will help Azets grow its revenues by 50% by the end of 2028.

Established in 2016, Azets is a business advisory and accounting firm headquartered in London. The company has since grown to more than 165 offices globally, with some 7,000 staff working with 120,000 clients. The company’s rapid growth has been backed by UK private equity investor Hg – a specialist investor in European and transatlantic software and services businesses – since its inception.

This enabled Azets to complete seven acquisitions in the first half of mid-2022: Tait Walker, Garbutt & Elliott, and Inspire in the UK; Karabingruppen in Norway; DanAccount, and KMD Perspektiv in Denmark; and Isännöinti Rantamäki in Finland. It was also a driving force behind efforts to add 900 roles across its UK business in the following 12 months.

Baker Tilly Ireland and Naylor Wintersgill

In 2023, Azets has been showing no signs of slowing down, either. In March, Azets entered the Irish professional services market for the first time, following its acquisition of Baker Tilly Ireland, which rebranded as Azets Ireland with immediate effect. The practice will continue to be led by Neil Hughes, supported by a team of 100 people, including 11 partners, serving a portfolio of 2,000 clients.

Hughes commented, “We have enjoyed strong organic growth over the past five years as we continue to deepen our areas of expertise and build a team of specialists to support the evolving and changing needs of our client base. Our focus on the needs of owner managed and entrepreneurial led SMEs is unique and allows us to provide a broad range of professional services to the companies that are at the heart of the Irish economy.”

A month later, Azets also added acquired Yorkshire-based Naylor Wintersgill to its ranks. The £4 million independent firm of chartered accountants, business and tax advisors also rebranded as Azets, adding two offices to Azets’ UK network which now totals 90 locales. Managing Director Victoria Wainwright, who started her accountancy career as Naylor Wintersgill’s first apprentice in 1991, is continuing to lead the team as Office Managing Partner.

She noted, “The team at Naylor Wintersgill are thrilled to be joining Azets. This is a brilliant opportunity to strengthen our services offering to SMEs and owner-managed businesses in Yorkshire. It is also an opportunity for our team to be part of a much larger ecosystem, creating even more value for our clients.”

PAI Partners

Thanks to this growth, today Azets commands income of around £1.5 billion – remarkable for a firm which has not existed for a full decade – but it plans to increase that by a further 50% in the next five years. To maintain this momentum will require a further injection of funds, and so Azets has decided the time is right to bring on board a second investor.

PAI Partners – a French private equity firm which also has stakes in HKA, Uvesco and Theramex – has joined the business as a new investor. Following completion, PAI will hold an equal and co-controlling stake in Azets alongside current owners Hg. With this support, Azets hopes to be well placed to continue its successful growth strategy, including spreading its presence in new and existing markets across Europe through a combination of organic growth and further strategic M&A.

Hg and Azets management were advised by JP Morgan as lead advisor, along with Jefferies, Alpha Advisory, Skadden, EY, Deloitte and OC&C. Meanwhile, PAI Partners was advised by Deutsche Bank, Freshfields, KPMG, Alvarez & Marsal and Bain & Company.

Colm O’Sullivan, a Partner at PAI Partners, noted, “With its proven and resilient business model, Azets provides a strong platform for future growth. Thanks to its leading market positioning, the firm is well placed to benefit from the growing levels of compliance, regulation and outsourcing that underpin its core services market. We look forward to partnering with the management team and Hg in this next phase of Azets’ growth.”

Gorilla Accounting

Speaking on the move, Jeremy Fearnley, group head of M&A at Azets added, “Our multi-year M&A strategy underpins our continued growth, targeting significant purchases aimed at consolidating Azets’ position as the advisor of choice for SMEs and owner-managed businesses across Europe.”

The deal has already helped back up one deal, too. Days after Azets announced its new injection of funds from PAI, it also confirmed it has closed a deal to purchase digital accountancy firm Gorilla Accounting.

Gorilla Accounting was founded by Dan Fallows and Tim Murphy in 2015 and has grown to 45 people. Azets’ SME clients will benefit from enhanced digital services. Gorilla Accounting will retain its brand as part of Azets.

Fallows, the managing director of Gorilla Accounting, remarked, “We founded Gorilla with the ambition of modernising and digitising the accountancy market for small companies and individuals seeking a hassle-free, personalised service – and we’re delighted that Azets has recognised Gorilla as best in class for those that want an online, digitally served accounting solution.”