HBK CPAs & Consultants (HBK) announced it is expanding its Mid-Atlantic Region through a merger with Zapken & Loeb, LLP. The New York Metropolitan area 70-person CPA firm provides accounting and business consulting services to business owners, executives, and independent professionals. The merger was effective as of November 1, 2023.

“Howard Zapken, Stanley Loeb and their team of talented professionals have been delivering high-quality accounting and business consulting for more than three decades,” noted HBK Managing Principal & CEO Christopher M. Allegretti. “This merger is the largest in our firm’s long history and not only extends our presence in our Mid-Atlantic region, but adds to our deep expertise in a wide range of accounting disciplines and industries.”

“We are pleased to join HBK to ensure the next stage in the growth of our business,” noted Zapken & Loeb Founder and Managing Partner Howard N. Zapken, CPA. “HBK will offer our clients additional services that a firm with such a national reach can obtain.”

As part of the transition Tanvi Shah, CPA; Alex Charitos, CPA; Nachu Vellayappan, CPA; Kieron Ludde, CPA; and Scott Anderson, CPA have joined HBK as Principals of the firm. Howard Zapken, CPA; Jeff Isaacson, CPA; and Steve Bandini, CPA will join the firm as Senior Directors.

“HBK has a track record of being a dominant player in secondary markets,” commented Whitman Transition Advisors CEO Phil Whitman, who advised both firms on the transaction. “The merger of Zapken & Loeb brings HBK five young Principals who are poised to bring the firm significant growth and expansion opportunities on Long Island.”

Like HBK, Zapken & Loeb professionals offer deep expertise in a variety of industries, including construction, manufacturing, and health care.

“Zapken & Loeb mirrors our focus on providing business owners skilled professionals with deep experience in their industry to help them proactively manage their biggest financial challenges as they compete and grow,” said Thomas M. Angelo, CPA, CITP, Principal-in-Charge of HBK’s Mid-Atlantic Region.

HBK provides small to mid-market businesses and their owners and operators a wide range of financial solutions, including accounting, tax, and audit services; wealth management; business valuation; transaction advisory services; forensic accounting; litigation support services; and business consulting, including broad expertise in a number of major industries. The CPA firm dates back to 1949 and added its wealth management practice in 2001. HBK CPAs & Consultants and HBKS Wealth Advisors serve clients locally out of offices in Columbus and Youngstown, Ohio; Pittsburgh, Philadelphia, Erie, Hermitage, Meadville, and King of Prussia, Pennsylvania; Holmdel and Cherry Hill, New Jersey; Fredonia, New York; and Fort Myers, Naples, Stuart, Sarasota, and Boca Raton, Florida. HBK ranks in the Top 50 on Accounting Today’s list of the largest U.S. CPA firms; HBKS Wealth Advisors is a Top 100 registered investment advisory.

HBK CPAs & Consultants, a Top 100 accounting firm, and Vertical Solutions, a Pittsburgh-based managed service provider (MSP), today announced they have entered into a definitive merger agreement. Upon closing of the transaction, Vertical Solutions will merge operations with HBK IT, an HBK company. The entity (Combined Company) will be renamed “Vertilocity” and operate out of Pittsburgh and Clark, New Jersey, and in the Denver, Colorado area. Vertilocity will be led by Bruce Nelson, president of Vertical Solutions. The Combined Company’s annual gross revenue is estimated currently at $10 million.

“Digital technology is the most impactful disrupter in business today,” said Christopher M. Allegretti, CPA, HBK managing principal and CEO. “Everywhere and in every industry, companies are embracing digital transformation. The Vertical Solutions team is steeped in experience in organizational workflows, systems, and software, and will support our initiative to provide relevant, sophisticated technological support to our clients.”

Founded in 1993 and acquired in 2007 by R.L. Nelson and Associates, Inc., a Pittsburgh-based information systems consulting firm founded in 1986, Vertical Solutions has established itself as a trusted advisor to companies on their technology-based business management systems. The firm was among the earliest entries in the field of managed services providers and offers a vast array of IT-related services and support, including proactive managed IT support, advanced threat protection, Office 365 management and support, technological tools and software designed to address an organization’s specific processes, and hardware procurement and installation. Vertical Solutions has specialized in working with healthcare businesses and institutions, and as such, the merger also serves to enhance HBK’s support of its more than 600 healthcare clients.

“I’m extremely excited about what this merger brings to our team and the clients of both firms,” noted Bruce Nelson, president of Vertical Solutions. “HBK IT has extensive capabilities, and our firms share a vision for technical solutions, that they are built around solving business challenges. Our collective technical expertise along with the financial services offered by HBK combine for a unique, comprehensive, and extremely valuable offering to our current and future clients.”

Vertical Solutions operates out of offices in Pittsburgh and remotely in and around Denver where about one-third of its clients are located. As such, the merger not only extends HBK’s reach in the West, but gives the Combined Company a significant IT services presence in three major markets: Pittsburgh, Denver, and New York Metropolitan Region. It also allows HBK to deliver comprehensive IT and MSP services, including cybersecurity support, to the firm’s accounting and financial services clients throughout Ohio, Pennsylvania, New Jersey, and Florida.

Since the turn of the century, HBK has been investing in its own digital transformation.

“We have been committed to enhancing our technological capabilities as well as technology-based services to our clients,” Mr. Allegretti said. “Internally, technological capabilities are key to being able to pivot quickly and effectively when it comes to unexpected challenges, as it did in 2020 in response to the unprecedented challenges associated with the COVID-19 pandemic.”

HBK provides small to mid-market businesses and their owners and operators a wide range of financial solutions, including accounting, tax and audit services; wealth management; business valuation; corporate finance; forensic accounting; litigation support services; and business consulting, including specific expertise in a number of major industries. The CPA firm dates back to 1949 and added its wealth management practice in 2001. The financial professionals of HBK CPAs & Consultants and HBKS Wealth Advisors serve clients locally out of offices in Columbus, Youngstown and Alliance, Ohio; Pittsburgh, Philadelphia, Erie, Hermitage, Meadville and Blue Bell, Pennsylvania; Princeton, Cherry Hill and Clark, New Jersey; and Fort Myers, Naples, Stuart, Sarasota and West Palm Beach, Florida. HBK CPAs & Consultants and HBKS Wealth Advisors are both Top 100 rated firms. HBK ranks 52nd on Accounting Today’s list of the largest U.S. CPA firms with firm-wide revenues totaling more than $100 million. 

Last year was a difficult year for the world, especially for nonprofits organizations. Many had to adapt and learn how to provide services in different ways. Many saw a huge uptick in the need for their services. And sadly, many lost most or all of their older volunteers, or had to close their doors temporarily or permanently.

Funding has been erratic, with many donors having to cut back on charitable giving due to financial difficulties. Federal, state and local relief funding has provided some support, though smaller organizations struggled through the application processes.

In August of 2020, The Washington Post predicted that between the pandemic and the recession, as many as one third of nonprofits will close or merge before the economy recovers. The demands of 2020 forced organizations to reshape their future, and to contemplate merging with another organization in order to continue their charitable purpose.

Overview of Mergers

Mergers can be a positive thing. The old saying, “Lead from a position of strength,” truly applies in these situations. Rather than looking at a merger as a route out of financial distress or a leadership void, proactive leadership considers mergers an effective growth strategy in strategic planning. Merging two or more organizations serves to increase the depth and scope of services the organizations are able to offer. They may also improve efficiency, help build capacity, and increase the geographic coverage that an organization is able to serve.

Some Questions to Ask When Considering a Merger

Here are some important questions nonprofit organizations should ask when considering whether a merger makes sense:

• Is there mission alignment between the two organizations?
• Can mutual merger gains be identified?
• Does either organization face a founder transition?
• What are the financial and legal challenges?
• Will there be considerable technology and policy changes?
• Are there resources, funding and volunteer time that can be dedicated to the merger?
• Has each party done its own SWOT (Strength, Weakness, Opportunity, Threat) analysis?
• Since mergers can take many months, or even years, has an appropriate timeline been considered?
• Will cultural integration be possible?

Establishing a Relationship Prior to Merging

The most successful mergers have strong working relationships before merging. A shared service agreement between the parties may be a good step to test the waters prior to contemplating a merger. These shared agreements typically cover accounting, finance, development, and marketing staff, and allow executives and staff from each organization to work together. Beyond the limited scope of the shared service agreement, there is generally no commitment to any further relationship between the organizations.

Another option may be to form a collaboration or partnership to share programs or delivery of services. This relationship allows each nonprofit to maximize their complementary strengths, and is typically used for a specific program or purpose. Collaborations and partnerships generally require each organization to contribute funds, resources, or services.

A third alternative may be to create a partially integrated merger. In this situation, two organizations merge but retain their individual brands. This strategy is generally used when a larger organization and a smaller organization with similar missions and services wish to establish a relationship. Often we see these smaller organizations marketed as “an affiliate of” the larger entity. For this type of relationship to work, it is vital that each organization’s stakeholders (board members, directors, donors, beneficiaries and staff) continue to have a voice in their organizations.

A Fully Integrated Merger

With a fully integrated merger, either one organization acquires the second, which is then legally dissolved, or a new organization is established and the original organizations are merged into the new entity. Some factors that must be considered in order to have a successful merger are:

• All executives and board members must be merger champions;
• Stakeholders on all levels should be involved in the process;
• There should be opportunities for funders to participate in and give input into merger planning;
• Due diligence will take time and may require outside experts such as attorneys and accountants;
• Open, honest communication is a must; and
• Consider that an outside facilitator will bring specialized skills to the M&A transaction discussion.

As nonprofits look toward the future, a strategic pivot such as a merger should be considered. The HBK Nonprofit Solutions Team has worked extensively with nonprofit organizations to develop strategic relationships and complete fully integrated mergers. Contact your HBK Advisor or a member of the HBK Nonprofit Solutions Group for more information.

HBK IT LLC, a member of the HBK family of companies, announced today it has acquired Unicom Solutions Group of Mountainside, N.J.

Unicom is a technology-consulting firm established in 1991 offering a suite of services to small and midsize private companies, nonprofits and government agencies. The acquisition complements the offerings of HBK IT LLC, which provides various digital transformation, managed services, cybersecurity consulting and enterprise resource planning to clients in a variety of industries.

“Bringing Unicom into the HBK family gives HBK IT even greater scale and technical expertise,” noted Tom Angelo, HBK Principal in the HBK Clark, N.J. office. “The merger will bring us a team of talented individuals as we continue to grow our advisory services and help our clients use technology to drive the growth of their business in an ever-changing digital world.”

“We continue to seek out new and innovative ways to transform our organization in this digital world through modern cloud solutions, financial applications, messaging and communications as well as infrastructure and cybersecurity,” added HBK Managing Principal and CEO Christopher Allegretti, CPA.

“Joining HBK was precisely the strategic move we were looking to make,” said Unicom founder Roman Sawycky. “It allows us to offer our staff more opportunities for personal development and professional training, and our clients a more complete set of products and services.”