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

Strategic rationale and market positioning

• Acquisition of Marcum elevates the 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.

• Combined entity now serves over 135,000 clients with more than 10,000 employees across 21 major markets, with a revenue base of approximately $2.8 billion.

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

• Integration focus is on systems, processes, and communication, with a detailed plan aiming for substantial progress within 12 months and full integration by 18 months.

Financial impact and synergy realization

• Transaction valued at $2.3 billion, funded equally by cash and shares, with a new share count rising to 65 million.

• Expected 10% accretion in year one, with further improvement as synergies are realized and leverage is reduced.

• Leverage increased to 3.5x EBITDA at closing, with a plan to delever to 2–2.25x within two years.

• Identified cost synergies include consolidation of facilities, IT platforms, and marketing, with $25 million in synergies embedded in margin improvement guidance.

• Share structure includes a lock-up and performance shares to align and retain key talent.

Growth outlook and acquisition strategy

• Organic growth has recently been driven more by pricing than volume, but the goal is to balance both as market conditions normalize.

• Integration of Marcum is the top priority for the next 12–18 months, but smaller strategic acquisitions will continue.

• Larger acquisitions may be considered after the integration period, leveraging the firm's enhanced attractiveness as an acquirer.

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

• Benefits and insurance offerings are expected to increase client stickiness and retention.