No accounting for merger failure
UHY and Carlin, Charron were betrothed just a few months ago. Now the marriage is off.
by Jonathan O'Connell
Is a leader a leader if no one follows him? That's the question facing Robert H. Charron, managing partner of Carlin, Charron & Rosen, the Westboro, Mass.-based accounting firm with a brand-new office in Glastonbury.
In January, Charron announced plans to merge the firm into UHY Advisors, a Chicago-based company that ranks 14th in the nation among accounting firms.
But some of Carlin Charron's 16 equity partners, 12 of whom needed to approve the deal for it to go through, balked.
"Most of the negotiations were done at the beginning, with myself and Tony, and it's fair to say we couldn't have gotten along any better," Charron said, speaking of UHY's New England region CEO, Anthony P. Scillia.
"But there were a number of people involved in negotiating the details, and you really need to get a consensus," Charron added.
That consensus never materialized for Charron, even though the firm announced the merger plans publicly in January.
Charron declined to say whether the issue came to a vote, citing a non-disclosure agreement. He also declined to release the names of the firm's equity partners. But he expressed confidence that he would remain as managing partner and the clients would retain confidence in the firm, despite the failed merger.
Scillia said that as negotiations proceeded, there were no surprises on UHY's end that killed the deal.
Expansive vision
In January, UHY hoped the move would be the beginning of a series of expansions in the Northeast that would enable the firm to grow its business among mid-market clients. CCR, which targets retailers, manufacturers and others businesses in the range of $50 million in annual revenue, seemed a good fit.
Other local accounting executives were surprised that the merger had been announced without approval by other partners.
"It's hard to know what went on," said James Patterson, CEO of Patterson and Gerry CPAs in Framingham, "but mergers done right are very, very hard to do...and something wasn't going to fit."
Exposure issue
Of the early announcement from CCR, Patterson said, "there's a lot of things that can go wrong, and if you jump into it too soon, it can blow up on you.
He also said he wouldn't be surprised if CCR took another crack at a merger in the future.
John E. Graham, president of Graham, Love, Huckins and Shepherd in Worcester, said "it's unfortunate" for everyone involved that the merger did not go through.
"They probably went public because they had to," Graham said. "It probably got leaked out in the street, and what do you do then? Deny it? Confirm it?"
"Any time a deal goes bad, there's a little disappointment," Graham said. "It must be a huge disappointment for some of the people at CCR who were getting ready to retire," he said. "If someone buys you out, at some point, you may be able to exit stage left, but if no one buys you out you'll have to stay."
Jonathan O'Connell is a staff writer for the Hartford Business Journal and can be reached at joconnell@hartfordbusiness.com. Matthew L. Brown, WBJ staff writer, also contributed to this story and can be reached at mbrown@wbjournal.com.
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