The firm formerly known as Anderson Anderson & Brown has been on something of an acquisition spree over the last couple of years.
After gaining an unspecified investment from private equity firm August Equity in October 2021, the accountancy practice has expanded into audit and accounting, tax, payroll and HR, outsourcing and advisory solutions.
Supporting clients across nearly every major country in Europe, as well as north and south America, Asia, Africa and Australia, it has around 1,000 staff - including 79 partners - and turnover in the region of £80m.
The group now consists of the main firm AAB and A2+B - which offers payroll and employment tax services - alongside financial planning division AAB Wealth; AAB Consulting; AAB People; Leeds-based accountancy and advisory services firm Sagars; Irish accountants and advisors FPM; joint venture audit company John F Daly Associates; fraud prevention firm SeeHearSpeakUp; HR business Think People Consulting; tax advisory firm May Figures; and professional services company French Duncan.
In order to get a better idea of what's been going on recently, we sat down with chief executive Graeme Allan, who has led the business since 2015.
From an accountancy practice in Aberdeen to a business services group spanning the UK and Ireland - the last few years have been quite a growth journey - what has your role been in driving things forward?
The expansion started with a move to Edinburgh, then an acquisition which took us into Glasgow.
There was always a mandate to support the growth journey, building a business in the main cities, at scale. This was helped by the fact we're a partnership - we've always done succession well - which allows the business to move at pace.
During 2018 and 2019 the profession began to change - and we’ve always looked to the broader geography to see the direction of travel - so it became clear that our plan was to be a professional services group ready for the next decade.
Of course Covid came and changed all that, but at the same time it meant there was increased interest from private equity in the sector, looking to be able to back an accountancy roll-up.
Our corporate structure - having a firm board - made us quite interesting, so then it was just about finding the right partner.
So this current growth strategy really accelerated in 2021 with the funding from August Equity?
Once they came in we already had a plan - we built a memorandum of what we can do, what backing we needed, etc - to which the private equity thesis had to align.
We wanted regional hubs, with businesses that were culturally aligned and sharing the same tech strategy. August was the right partner to help us back that plan.
Then there was the rebrand in 2022 - are there any other changes internally that we might we not have heard about?
Outside of the transactions, we’ve built a group under a banner of sharing, as we all know we have different specific strengths.
Some of the firms we bought brought a broader service offering, introducing new services to clients, so we didn’t try to change systems on day one.
The latest in your acquisition spree caused quite a stir in the market - can you talk me through how the French Duncan deal was done?
Typically, we have a deal initiation - and so do August - so we said there was a pipeline of opportunities that we felt would be a good fit, with direct access. We have very good networks, so that opens up a discussion.
That’s usually me and Doug Martin, our chief commercial officer, using an initiation team, which has been very successful.
People are at the heart of these discussions, so integration starts long before completion, we'll talk with chief people officer and chief operating officer to understand how team dynamics work. Then there's a lot of work during due diligence.
How’s the integration of these various firms going - and what’s the wider strategy been with bringing businesses into the fold?
It will come as no surprise that when you buy eight businesses in 18 months you get what we call indigestion.
So there’s a bit of that going on, in order to do it well you need the teams to work closely to make sure they understand the story and feel part of the journey. We spend a lot of time on communication.
There’s often a fall off in performance after a deal is done, as time is being taken on non-business stuff. But it’s really important to get these things right for the longer term. Anyone who’s done acquisitions knows there’s an element of that.
Looking ahead then, how ambitious is AAB - wider geographical expansion, or diversification into other business streams?
I have a line I use - ‘we’re not done yet’ - we have to continue with the plan which we set out, which is currently focused on regional business in the UK, at scale, with significant companies across professional and business services and wealth management.
August are committed to this, but we will continue the journey long after we have a new investor in the group - because that’s what it will take to really scale.
They've been a great early stage backer, but at some point they’ll exit and someone will replace them.
We've also got support from an HSBC and Investec banking syndicate, so we have a lot of runway to do significant transactions and we’ll continue down the private equity path.
The plan is for further expansion across English regional cities, as well as a focus on London and Dublin, with other parts of the business services and wealth management piece.
A number deals are in the early stages and we're constantly working on building our pipeline.
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