The CPA Consolidation Play: Why Baker Tilly and Moss Adams' Merger Could Be a Game-Changer in Accounting Services

The U.S. accounting and advisory sector is undergoing a seismic shift, and the April 2025 merger between Baker Tilly and Moss Adams stands as a landmark moment. Backed by Hellman & Friedman (H&F) and Valeas Capital Partners, this strategic union aims to create the sixth-largest CPA firm in the U.S., with ambitions to rival the "Big Four" in select niches. Here’s why investors should pay close attention.

A Marriage of Strengths

The merger combines Baker Tilly’s national footprint and global ties with Moss Adams’ West Coast dominance and specialized advisory capabilities. By merging audit operations under Baker Tilly US, LLP, and advisory services under Baker Tilly Advisory Group, LP (BTAG), the new entity will streamline operations while preserving the partnership ethos valued by professionals.

The financial scale is staggering: the combined firm targets $3 billion+ in annual revenue (based on 2024 figures) and over 4,800 professionals across 30+ U.S. offices. This leap in size positions it ahead of mid-market rivals like BDO and Grant Thornton, leveraging global networks such as Baker Tilly International (143 territories, 43,500 professionals) and Praxity (110 countries).

Private Equity’s Catalyst Role

Hellman & Friedman’s involvement is no afterthought. The firm already held a stake in Baker Tilly from its 2024 investment and now commits a “meaningful additional strategic investment” to fuel growth. Valeas Capital also ups its stake, signaling confidence in the merged entity’s prospects.

Private equity backing is critical here. While traditional accounting firms have long resisted external capital, this merger flips the script. H&F’s capital infusion will fund talent acquisition, tech upgrades, and acquisitions—key levers to compete in an industry where clients demand more than tax and audit services.

Leadership and Long-Term Vision

The leadership transition is equally telling. Jeff Ferro (Baker Tilly’s CEO) stays on until 2025, then hands the reins to Eric Miles (Moss Adams’ CEO). This phased approach minimizes disruption while ensuring continuity. Ferro’s post-retirement board seat underscores a culture of institutional knowledge retention—a rarity in rapid-growth firms.

The real prize is the $3 billion+ revenue target, which demands aggressive cross-selling of advisory services. Moss Adams’ expertise in healthcare and technology sectors, paired with Baker Tilly’s international reach, could open doors to multinational clients. Meanwhile, H&F’s emphasis on “evolving middle-market client needs” hints at a focus on high-margin advisory work, not just commoditized accounting.

Why This Matters for Investors

The merger isn’t just about size—it’s about positioning. The U.S. mid-market accounting sector is ripe for consolidation. Clients increasingly seek firms that blend traditional accounting with data analytics, ESG consulting, and digital transformation—a gap the merged entity aims to fill.

Consider the numbers:
- $3 billion+ revenue would place the firm among the top 10% of U.S. accounting firms by scale.
- 4,800 professionals mean deeper industry specialization and geographic reach.
- Global networks (via Baker Tilly International) reduce reliance on U.S. markets alone.

The private equity angle is a double-edged sword. While H&F’s capital accelerates growth, eventual exits (e.g., IPO or sale) could pressure short-term profitability. However, the firm’s 20-year track record in scaling professional services firms—like its success with Bridgewater Associates—suggests it’s in for the long game.

Conclusion: A Bold Bet on the Future

This merger is more than a consolidation—it’s a blueprint for how mid-market accounting firms can compete in a tech-driven world. With $3 billion in revenue, 4,800 professionals, and the backing of a private equity titan, the new Baker Tilly/Moss Adams entity is poised to redefine industry standards.

Investors should watch three key metrics:
1. Revenue growth post-merger: Does advisory revenue outpace audit?
2. Global network utilization: How many international deals leverage Baker Tilly International’s reach?
3. Talent retention: Can leadership retain top partners amid rapid scaling?

If executed correctly, this could be the first step toward creating a “Big Five” firm. Even if it falls short, the merger underscores a broader trend: the professional services sector is no longer about spreadsheets alone. It’s about who can digitize, globalize, and advise fastest—traits this new entity is banking on.

In the end, the merger’s success hinges on execution. But with the right capital, structure, and leadership, this could be the deal that reshapes the accounting landscape for decades.