William Buck & Australian Accounting Roll-Ups

Kelly Partners Group (KPG) is based in Sydney, Australia. KPG does tax accounting for private companies and their owners. The firm was founded 15 years ago by Brett Kelly and went public in mid-2017. It consists of 26 operating units. 49% of each unit is owned by the partner and 51% by the parent. With around 9,500 customers, KPG has a total turnover of A$48.9 million and an EBITDA margin of 33%.

Since its foundation, the company has grown revenues by 30% per year. KPG systematically acquires smaller tax firms. The purchase price multiple is usually six times the cash flow post implementation of KPG best practices. Banks finance about two-thirds of the full price and the rest is financed by a vendor loan. As a result, KPG can grow through acquisitions without having to reinvest its equity. This creates a fabulous compounding engine.

Brett Kelly, the CEO of KPG, owns 50% of the company. There may be an element of key man risk as the firm appears to be reliant on Brett for upholding the culture and driving the vision for the firm.

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Lindsay Holloway

Managing Director at William Buck