Key Takeaways
- • Broad Sky Partners has exited its 3.5-year investment in Smith + Howard by selling the Atlanta-based accounting firm to TPG, completing a transaction that marks a "flip" from one private equity owner to another in the growing trend of PE consolidation in the accounting services sector.
- • Smith + Howard grew significantly during Broad Sky's ownership period, expanding to 800 employees across 11 locations nationally, demonstrating the scale-building strategy common to PE-backed accounting firm acquisitions.
- • The transaction underscores accelerating PE activity in professional services, with accounting firms increasingly becoming targets for private equity ownership and subsequent resale, mirroring broader trends in the sector where nearly half of the top 30 U.S. accounting firms now have PE backing.
- • TPG's acquisition represents continued capital deployment in the accounting services vertical, a sector experiencing substantial consolidation activity as PE firms recognize opportunities in professional services platform building.
Summary
Broad Sky Partners has completed its exit from Smith + Howard, one of Atlanta's largest accounting firms, by selling the company to TPG after a 3.5-year partnership that substantially expanded the firm's footprint and capabilities. The transaction marks another example of the emerging "flip" trend in accounting services, wherein PE investors acquire firms, implement operational improvements and growth initiatives, and subsequently exit through sale to another financial sponsor.
During Broad Sky's tenure as majority backer, Smith + Howard was transformed into a national accounting and advisory platform. The firm grew to 800 employees operating across 11 locations, reflecting the aggressive expansion strategy typical of PE-backed consolidation plays in the professional services space. This growth trajectory illustrates the operational leverage that private equity ownership can deploy within accounting services firms through geographic expansion, talent acquisition, and cross-selling initiatives.
The transaction occurs within a broader structural shift in the accounting industry. Recent market data indicates that nearly half of the top 30 U.S. accounting firms now operate under private equity ownership. Comparable transactions in this vertical include the January 2025 "flip" executed by Citrin Cooperman, which changed hands from New Mountain Capital to Blackstone, and the $7 billion PE-backed merger between Baker Tilly and Moss Adams. This consolidation wave reflects PE investors' recognition of recurring revenue potential, scalable business models, and fragmented market structures within professional services.
TPG's acquisition of Smith + Howard from Broad Sky signals continued institutional capital commitments to the accounting services sector despite ongoing questions about the sustainability of PE ownership models in professional services firms. The transaction represents both an exit opportunity for Broad Sky and a new growth platform acquisition for TPG as the firm seeks to build or expand its presence in professional services verticals.
During Broad Sky's tenure as majority backer, Smith + Howard was transformed into a national accounting and advisory platform. The firm grew to 800 employees operating across 11 locations, reflecting the aggressive expansion strategy typical of PE-backed consolidation plays in the professional services space. This growth trajectory illustrates the operational leverage that private equity ownership can deploy within accounting services firms through geographic expansion, talent acquisition, and cross-selling initiatives.
The transaction occurs within a broader structural shift in the accounting industry. Recent market data indicates that nearly half of the top 30 U.S. accounting firms now operate under private equity ownership. Comparable transactions in this vertical include the January 2025 "flip" executed by Citrin Cooperman, which changed hands from New Mountain Capital to Blackstone, and the $7 billion PE-backed merger between Baker Tilly and Moss Adams. This consolidation wave reflects PE investors' recognition of recurring revenue potential, scalable business models, and fragmented market structures within professional services.
TPG's acquisition of Smith + Howard from Broad Sky signals continued institutional capital commitments to the accounting services sector despite ongoing questions about the sustainability of PE ownership models in professional services firms. The transaction represents both an exit opportunity for Broad Sky and a new growth platform acquisition for TPG as the firm seeks to build or expand its presence in professional services verticals.
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