Business for The Bonadio Group’s private equity practice naturally dipped during the financial meltdown several years ago. The group helps companies mulling mergers and acquisitions and those looking to sell, recapitalize, or raise debt and equity capital. Bonadio announced a new partnership in March that it says will help grow its private equity work. When […]
Business for The Bonadio Group’s private equity practice naturally dipped during the financial meltdown several years ago.
The group helps companies mulling mergers and acquisitions and those looking to sell, recapitalize, or raise debt and equity capital. Bonadio announced a new partnership in March that it says will help grow its private equity work.
When the economy went south in 2008, all the deals the firm was working on at the time evaporated, says Jeff Lewis, a Bonadio partner and head of the firm’s private equity practice. Money for deals dried up as investors clutched their cash.
“We probably had half a dozen deals we were working on and every one just cratered,” he says.
The business began to recover in 2011 and looking forward, Lewis says demand is likely to surge. Bonadio’s clients have been asking for private equity services more and more, he notes.
“Over the next five to 10 years, there’s going to be unprecedented activity in the [mergers and acquisitions] space as the baby boomers begin to retire,” he says.
Rochester–based Bonadio has been offering private equity services for years and last year packaged them all under a single umbrella. About a dozen partners help Lewis with the work as needed.
Eventually, the firm is aiming to have a private equity specialist in each of its markets. Bonadio has additional offices in Buffalo, Syracuse, Albany, Geneva, Perry, New York City, and Utica.
The new partnership is with Decosimo Corporate Finance, LLC, the investment banking unit of Decosimo Certified Public Accountants, based in Chattanooga, Tenn. Decosimo will serve as Bonadio’s broker-dealer on transactions.
The partnership also involves Doeren Mayhew, an accounting firm with offices in Houston and Detroit.
All three firms will work together to develop and share best practices in investment banking and collaborate on transactions, according to Bonadio.
The relationship allows Bonadio clients access to networks around the country, Lewis says. Bonadio expects to work with Doeren and Decosimo to help local companies find potential buyers and investors.
The firm realized last year after it organized its private equity practice under a single banner that it needed to either start its own broker-dealer service from scratch for find a partner it could use, Lewis says. Starting the service alone would have created new regulatory burdens and been costly, he explains.
So Bonadio first began by speaking with traditional investment banking firms about partnerships. The firm eventually found Decosimo through Moore Stephens North America, an association of 50 accounting firms in the U.S., Canada, Mexico, and the Caribbean.
Decosimo matched up better philosophically for Bonadio than traditional investment banks, which often don’t get paid unless a client completes a transaction with them, Lewis says.
“We don’t have to close a transaction in order to eat next week,” he notes.
Lewis says he’s already had conversations in some of Bonadio’s markets with private equity professionals looking to join up.
“The market seems to be taking notice that we’re in this space,” he says. “We think that’s a good sign.”
Bonadio has 400 employees and projected revenue of $54.9 million for its 2013 fiscal year.
Contact Tampone at ktampone@cnybj.com