CBIZ (CBZ) Sidoti Small-Cap Virtual Investor Conference summary

Strategic rationale and market positioning

• Acquisition of Marcum elevates the combined firm to the 7th largest accounting firm, enhancing talent attraction and client service capabilities.

• Expanded scale enables broader service offerings, deeper industry expertise, and improved competitiveness in key markets like New York, California, and Florida.

• The combination creates a platform with over $2.8 billion in revenue, 10,000+ employees, and 135,000 clients across 21 major markets.

• Recurring revenue now represents 77% of the portfolio, supporting stability across business cycles.

• Integration is a top priority, with a detailed plan aiming for substantial progress within 12 months and full integration by 18 months.

Financial impact and transaction structure

• Transaction valued at $2.3 billion, funded 50% in cash and 50% in shares, with a $2 billion facility led by Bank of America.

• Shareholder accretion expected at roughly 10% in year one, with further improvement as synergies and deleveraging progress.

• Initial leverage rises to 3.5x EBITDA, targeted to return to 2–2.25x within two years as integration costs subside.

• Cost synergies identified in corporate functions, IT, marketing, and facilities, with $25 million embedded in margin improvement guidance.

• Share issuance structured to align new partners, mitigate market overhang, and support retention through performance shares.

Growth strategy and outlook

• Continued focus on integrating Marcum, but smaller acquisitions in strategic markets or service lines will still be pursued.

• Organic growth has recently been driven more by pricing than volume, but the goal is to balance both equally over time.

• Client retention rates are around 90% for both legacy firms, expected to improve with expanded service offerings.

• Post-election environment is expected to boost discretionary advisory services and project work in 2025.

• Leadership transition announced with a new CFO incoming and planned retirement of the current CFO.