Why the principal of this $1.4b super-firm sold control to Count

Count Group has agreed to buy an initial 75 per cent interest in Skybridge Financial, the Inverell-based accounting and advice group founded in 1975, in what it calls its largest equity partnership acquisition to date. The deal values Skybridge at $66.0 million and adds $1.4 billion in funds under advice, 13 advisers and 82 accountants across 16 locations in NSW, Victoria and Queensland.

For Jason Birch, who bought into the firm after a partner’s sudden death and has since led roughly 35 acquisitions, the sale is less an exit than a way to fund what comes next. He told Professional Planner the plan is for Skybridge to “roll on” as it is, with a bigger balance sheet behind it.

Skybridge’s story starts with a succession crisis. The Inverell firm began in 1975 as a traditional partnership, and one of its partners died unexpectedly.

Birch was working at another firm at the time and knew the remaining partners had no succession plan. He approached them, moved across and bought the late partner’s equity. A financial planner joined him as a partner around 2000, and over the next few years the older partners left, leaving Birch as the accountant and his partner as the planner.

Roughly 35 acquisitions, mostly accounting-led

Skybridge made its first acquisition, a Sydney firm, in 2005. Around 2008 Birch bought out his planning partner, and the global financial crisis forced a hard look at costs. Once he had sole control, he says, he no longer needed anyone’s permission to move, and the pace picked up.

Since then the group has bought about 35 accounting and financial planning businesses. It started buying in northern NSW and the New England region, spread along the coast through Grafton, Coffs Harbour and Port Macquarie, and later reached Brisbane and Melbourne. The 2021 Shepparton deal, which brought several firms together, was a turning point. Birch believes the group passed $1 billion in funds under advice some time after that, though he admits he has never tracked the exact moment.

Growth has been dominated by acquisitions, helped by kind markets and what he describes as an acceleration effect once a group reaches scale. Planning businesses are scarce and expensive, so Skybridge bought where it already had a connection, usually through an accounting relationship. The mix has tilted towards accounting, with planning once above 40 per cent of revenue.

Organic growth comes mainly from planning, fed by referrals from the accountants. Birch says Skybridge does not market publicly because referrals generate themselves.

His approach to acquisitions is to treat them as succession problems. The pain points are typically HR and IT, so Skybridge takes those on and adds capacity to those firms.

Why sell control now: a balance sheet

The constraint on growth, Birch says, has been funding. Banks became more comfortable as the group expanded and larger deals got easier, but he reached the point where he wanted a partner with a balance sheet to do bigger things.

That led him back to Count, a relationship with a long history. Birch says Skybridge first joined Count in 1995 and stayed 13 years before going its own way, and that he saw the start of what became CountPlus. The model, he notes, is different now.

What appealed was keeping the management team and business model intact while using Count’s capital to accelerate. His intention is for the business to “roll on” in the same way, with greater access to capital for more acquisitions and a faster pace.

Count chief executive Hugh Humphrey described the deal as a “step-change” in the group’s scale in accounting and financial planning.

Birch says the Count deal involved a lot more work than he expected. Skybridge had done plenty of acquisitions themselves, as the buyer not the seller, and never with a listed company.  He is happy with where it landed.

The deal: an initial 75 per cent

Count values 100 per cent of Skybridge at $66.0 million. The figures below are as reported from Count’s ASX announcement.

Component of the 75 per cent purchase	Amount
Upfront cash	$25.6 million
Upfront scrip	$4.0 million
Conditional deferred consideration	up to $3.3 million
Conditional earn-out (24 months after completion)	up to $5.8 million

Count will initially hold 75 per cent. Birch and employee shareholders keep the remaining 25 per cent, and key Skybridge personnel, including Birch, continue in leadership roles. The 13 advisers join the Count AFSL.

Count is funding the purchase with a fully underwritten institutional placement of about $25.0 million, plus existing cash and debt capacity. It also leaves room to keep pursuing its pipeline.

What can’t be bought

For all the deal mechanics, Birch comes back to people. A group built on 35 acquisitions only works if the principals and staff stay, and he sees that as the real asset.