Top 50 accounting firm Elliott Davis made two big announcements on Wednesday: it has a deal in place to receive outside capital from Flexpoint Ford, a private equity investment firm specializing in the financial services sector, and it named John Otten as its new CEO, effective July 1.
Financial terms of the deal with Flexpoint Ford weren’t disclosed.
An unofficial count by CPA Practice Advisor shows that 16 of the top 50 accounting firms by revenue, using INSIDE Public Accounting’s 2024 firm ranking, have sold stakes in their firms—many a controlling stake and some a minority stake—to private equity investors. Frazier & Deeter was the last firm to announce receiving such an investment in April.
- Related article: Frazier & Deeter Gets Capital Infusion From PE Firm General Atlantic
Greenville, SC-based Elliott Davis said the investment from Flexpoint Ford will accelerate the firm’s growth, expand its service offerings and geographic reach, and enhance its ability to attract and retain top talent. The firm said existing shareholders “will remain significant owners” in Elliott Davis.
Elliott Davis currently has nine offices throughout Georgia, North Carolina, South Carolina, and Tennessee, as well as a location in Bengaluru, India.
Elliott Davis will now operate in an alternative practice structure. Attest services will continue to be provided by Elliott Davis LLC, a licensed CPA firm. Business advisory and non-attest services will be delivered by Elliott Davis Advisory LLC, which will operate as a separate entity and not a licensed CPA firm.
“This marks an important milestone for Elliott Davis,” Otten said in a statement. “We are making significant investments in people, technology, and services to meet the evolving needs of our clients and ensure we remain a destination employer. Our partnership with Flexpoint Ford positions us well for continued expansion through both organic growth as well as through strategic acquisitions.”
With $8.2 billion of assets under management, Flexpoint Ford is a specialist private equity firm focused on middle-market investments in financial services and complementary industries, including business services and healthcare services. Founded in 2005, Flexpoint Ford has offices in Chicago and New York City.
The private equity firm said it will provide strategic insight, growth capital, and operational support “to help Elliott Davis navigate the evolving complexities of both the accounting profession and today’s dynamic marketplace.”
“We look forward to supporting Elliott Davis’s expansion through the continued recruitment and development of exceptional talent, alongside a disciplined and strategic M&A strategy designed to enhance capabilities and extend market reach,” said Jennifer Kim, principal at Flexpoint Ford.
Guggenheim Securities LLC and Koltin Consulting Group advised Elliott Davis, and Nelson Mullins Riley & Scarborough LLP and Vedder Price PC served as legal counsel to Elliott Davis. William Blair & Co. LLC advised Flexpoint Ford, and Simpson Thacher & Bartlett LLP and Hunton Andrews Kurth LLP served as legal counsel to Flexpoint Ford.
Allan Koltin, CEO of Koltin Consulting Group, who served as an advisor on the deal, told CPA Practice Advisor in an emailed statement, “Elliott Davis has been on a journey to build the firm of the future ‘today’ and its strategic combination with Flexpoint will only accelerate that mission. Flexpoint had evaluated other CPA firm platforms, but with Elliott Davis, it was ‘love at first sight.’ What makes them so special (in a pond of many PE firms) is their deep understanding and track record of advising ‘people businesses’ where the assets go home every night and decide if they want to come back the next day. Kudos to Guggenheim as well on bringing these tremendous firms together!”
During this new chapter at Elliott Davis, Otten will be in the driver’s seat, succeeding Rick Davis who has led the firm for more than 18 years. Davis will transition to an advisory role.
Otten, who has held several leadership roles during his 28-year career at Elliott Davis, is currently a shareholder and leader of the firm’s tax practice.
According to his bio, Otten focuses on providing tax services to companies with multi-state and international operations in the manufacturing and distribution, service, and technology sectors. He has worked extensively with private equity and other investment/financing groups in structuring deals and providing tax optimization strategies to portfolio companies. He also assists customers with complex tax reporting and planning in areas such as state and local taxation, economic incentives, and consolidated filings. In addition, he has experience in representing clients before the IRS and state taxing authorities.
“The future is bright with John at the helm,” Davis said in a statement. “He has long been a trusted advisor to our clients and a respected leader within our firm. John lives our values, embraces our mission, and is fully prepared to guide Elliott Davis into its next chapter.”
Thanks for reading CPA Practice Advisor!
Subscribe Already registered? Log In
Need more information? Read the FAQs
