RSM, one of the world’s largest accounting firms, is exploring a possible initial public offering as consolidation transforms the audit sector and disrupts the traditional partnership model. The 100-year-old partnership, which resisted private equity during the past five years’ deal boom, has been sounding out bankers and revamping internal systems to prepare for a potential stock market flotation. Executives say they need more capital for major acquisitions and international expansion than partners can provide, and view debt as less attractive.
RSM — the fifth largest accountancy in the US by revenue and seventh largest globally — would pursue an IPO if executives conclude it requires greater funding than available through partnership contributions. Unlike the Big Four — Deloitte, EY, PwC and KPMG — RSM focuses on mid-market corporate clients. Rivals like Grant Thornton and Baker Tilly have abandoned the partnership model and sold to private equity, increasing pressure on RSM to consider public markets.
The firm has strengthened ties between its US, UK and Mexican entities through an alliance generating over $5bn in annual revenue, mostly from the US. RSM is implementing public-company financial systems and adopting new technology to support AI-related services and acquisition growth, even if an IPO does not proceed. A spokesperson affirmed the firm is executing its strategy and well positioned for growth.
Source: Financial Times Companies · Summarized by HeadlinesBriefing