Professional services firm EY is joining forces with Frank Hirth, a boutique business providing UK and US personal tax services. The complementary ambitions look set to bring major benefits to clients
In a world where mergers and acquisitions are becoming ever-more popular, a select few make the private client industry sit up and listen. One such coalition was announced in February 2021 – boutique tax firm Frank Hirth was to be acquired by multinational professional services network EY. The two have joined forces as EY Frank Hirth to boost their collective offering to (U)HNW clients.
Mergers and acquisitions are delicate affairs, and not just any two companies can pair up. Tom Evennett, a partner of three years at EY, explains what attracted the firm to Frank Hirth: ‘Private clients are a real key focus area, both in the UK and globally, for [EY],’ he says. ‘As part of that growth strategy, we’re always thinking about where there might be excellent teams in the marketplace with good clients and a reputation that would be complementary to our business.’ Frank Hirth ‘fit that bill’, he says, which then ‘kicked off the discussions’.
Frank Hirth represents the opportunity to supercharge EY’s ambition in the private tax space, adds Evennett. ‘It’s an area that we had some capability in, but not huge,’ he says. ‘It’s great for our clients because they get the absolute best, both from a UK but also a UK/US perspective, in the personal tax world.’
From Frank Hirth’s side, EY is a good fit ‘because of its ambitions in the private market space’, says partner Michael Lewis, who joined the firm in 2016. This was demonstrated by EY’s recent investments in family office advisory, as well as, of course, its interest in the merger.
Although Frank Hirth was already established as a leader in the private client tax space, the firm aims to leverage its new position to target regional and international opportunities alike. ‘With the EY brand to help us on that expansionary piece – with their network – it helps us fulfil our ambitions of taking our business to the next level,’ says Lewis, adding that Frank Hirth had felt that it had come as far as it could as a boutique.
The integration is well under way, but clients of EY and Frank Hirth will not have noticed any disruption, say the partners. Instead, clients’ service will be enhanced, with both parties able to provide an elevated offering.
EY clients, says Evennett, will benefit from in-timezone US input and support. ‘Our clients don’t want to wait until New York opens, or Los Angeles. They want immediate thoughts and answers,’ he says. ‘Now we’ve got a wealth of experience to help us and tackle some of the most complicated US matters.’ In a world where almost all HNW families have a connection to either the UK or the US, this ‘depth of knowledge’ is indispensable, adds Lewis: ‘Those jurisdictions, for historical, cultural, and financial reasons, are very attractive from a tax perspective, a residence perspective, safety, language, culture, mobility….’ The UK and the US are also possibly the most complicated tax jurisdictions in the world. ‘To have specialists who can help navigate families through this is essential, because this linkage is only growing.’
Frank Hirth clients, meanwhile, will find their adviser can now also help them with business needs rather than just their personal affairs. ‘We can bring the power of EY to help support our clients’ connected businesses grow and succeed not just in the UK and US but globally too,’ says Evennett. Lewis adds that the deal bolsters Frank Hirth’s reputation – the strength of the EY brand brings ‘immediate credibility’, for those who may not be as familiar with the Frank Hirth name.
So, the two companies have complementary ambitions and mutual benefits: Frank Hirth was looking for scale and reach, while EY wanted to bolster their US capabilities in the UK. But it was also a match made in heaven from a ‘people perspective’. ‘There are huge development opportunities for our staff,’ says Lewis. ‘They can now get exposure to not just personal tax, but other parts of advisory. There’s the potential opportunity for secondments. We can keep our best people while offering them exposure that they otherwise would have had to leave to obtain.’
‘Our purpose is to build a better working world, and two of the key elements to this are our client centricity and the focus we have on our people,’ continues Evennett. Frank Hirth slotted right into this mould – perhaps, Lewis muses, due to the fact that much of the Frank Hirth leadership team are alumni of Big Four firms (accounting networks: EY, Deloitte, KPMG and PwC). ‘When it comes to philosophy, I think it’s very clear that we both put the client at the heart of what we do,’ he says.
Find Frank Hirth at: ey.com/ey-frank-hirth
Image: David Harrison