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BDO Put Out a Press Release on ESOP

guy reading a morning newspaper

BDO released a press release on ESOP at 10 am this morning, here it is in its entirety. Friendly reminder, BDO partners (current and former) and staff are encouraged to contact us at 202-505-8885 should you have any cares, concerns, or tales of phones being tracked you want to share with the class. Tipsters are anonymous, always.

BDO USA Stewards Transformative Next Chapter With ESOP

Purpose-driven strategy gives participating U.S. employees shared stake in firm’s success.

CHICAGO, AUGUST 2023 − BDO USA, one of the nation’s leading accounting and advisory firms, today announced its intention to establish an Employee Stock Ownership Plan (ESOP), providing a broad base of our employees the benefit of ownership and a new model for the firm’s continued investment, growth, and long-term sustainability. When effective, BDO would be the first large public accounting firm to implement an ESOP. With more than 10,000 participating employees, BDO would be among the largest ESOPs in the country.

“An ESOP is the realization of our purpose of helping people thrive, every day. It is a game-changer for our people, clients and communities, designed to improve lives for generations to come,” said Wayne Berson, CEO of BDO USA. “Amid the changing landscape of our profession, the ESOP unlocks the value of our firm today and embodies our strategy to sustain a strong, caring and resilient business for tomorrow. We are proud to establish this ESOP to invest in each other so everyone who contributes to our success has the opportunity to benefit from it.”

“Today’s talented professionals have many options in choosing where to start and build their careers,” shared BDO USA Chief People Officer Cathy Moy. “BDO has long been distinguished by a culture which puts people first with a commitment to thriving together. The ESOP will be unique and innovative in our profession and supports our goal to be an employer of choice.”

An ESOP is a qualified retirement plan established as a trust, where current and future employees receive beneficial ownership in the company over time. Through the allocation of company stock, participating BDO USA professionals will be able to access a retirement plan that requires no out-of-pocket contribution, helping them plan for their future financial well-being.

“The ESOP also has material benefit to the firm,” notes Steve Ferrara, Chief Operating Officer of BDO USA. “It allows for continued investment in quality, as well as operations and growth strategies, while maintaining continuity in leadership and commitment to a longstanding vision and purpose.”

Establishing BDO’s ESOP involved some of the leading ESOP advisors in the country. Stout, a global investment bank and advisory firm, acted as exclusive financial advisor and debt placement agent on the transaction. Global law firm, McDermott Will & Emery provided legal counsel. In addition, BDO has engaged an experienced, independent Trustee to represent the interests of ESOP participants. The debt financing to support the transaction was arranged by Apollo Capital Solutions and will be anchored by certain funds managed by affiliates of Apollo (NYSE: APO). The ESOP and related transactions are expected to become effective August 31, 2023. In conjunction with the effective date, BDO USA’s fiscal year end will change to December 31. Terms of the transaction are undisclosed.


Let’s Speculate Wildly About Why All the BDO USA Partners Are Getting Together for a Secret Meeting in Florida (UPDATE)


BDO partners in line for windfall after $1.3bn debt deal with Apollo Global Management [Financial Times]

13 thoughts on “BDO Put Out a Press Release on ESOP

  1. Congratulations to the BDO partners for finding a new way to screw over their employees by cashing out big time.

  2. So basically the firm is going to take on lots of debt in a high interest rate environment so that current partners can get fat payouts in exchange for their equity which will go into the ESOP? I’m assuming this will be presented as a tool to increase employee retention but this kinda seems like it only benefits the current partners.

  3. There were a lot of calls on this yesterday and my overall takeaway is that this is incredibly positive. I’m saying this as an MD who is interested in being a partner in the near future.

    The incremental debt load assumed to make this happen doesn’t seem excessive and the expected contribution to employee ESOP accounts is meaningful (incremental 10% of pay). I suspect this will really help recruit and retain employees. The culture at BDO is already better than any of the Big 4 firms (imo) and now we also offer a genuine long term incentive plan, which you can’t get anywhere else.

    1. I have counseled a lot of 21 year-olds looking for their first public accounting job and I cannot think of any one who would have made a decision based on an ESOP. Most assumed they would do 5 years or less in public accounting.

      Who stays in public accounting 20 years other than partners? A few lifer managers.

      Lots of questions here.

    2. So debt interest rate % is what, at least 10% (if not more)? Interest payments alone will be a lot, so nice try.
      Culture – I just LOL’d. You really got to find a better selling point. This whole thing kind of reminds me of the time when BDO cut their PTO hours (or rather capped them). It was also sold as a GREAT thing. “People will take PTO more often now!”
      Now for ESOP – sure, but it is all relative to the valuation. Plus ppl got to be lifers and vest ( I imagine vesting will be like 8-10 years to reach 100%).
      So again nice try, Mr. MD, or more likely, a senior partner who will cash out nicely and wants to control attrition.

    1. You sound like David Duke. BDO RISE does a fine job and they don’t whine about every task.

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