RSM McGladrey Business Services Completes Combination with American Express Tax and Business Services

Business Wire, Oct 3, 2005

BLOOMINGTON, Minn. -- RSM McGladrey today expanded its staff by 2,500 employees as it completed its acquisition of American Express Tax and Business Services (TBS).

The combination, announced Aug. 1, creates the largest U.S. accounting, tax and business services organization focused primarily on the needs of midsized businesses. RSM McGladrey, together with its attest partner McGladrey & Pullen LLP, will have combined revenues of more than $1 billion, making it the fifth largest accounting firm in the United States. RSM McGladrey now has more than 100 offices in 63 markets across the country.

"Midsized business owners will now have a national organization dedicated to their particular needs," said Steve Tait, RSM McGladrey Business Services president. "With additional talented professionals located in more U.S. markets, providing expanded services, RSM McGladrey is prepared to meet the fast-changing needs of midsized companies and their owners."

"The middle market represents the most dynamic sector of the American economy," added Tait. "RSM McGladrey is uniquely positioned to meet their accounting, tax and business consulting needs. Our expertise in the manufacturing, wholesale, distribution, financial service, healthcare, construction/real estate and public sector industries can help our clients grow and prosper."

The acquisition of TBS comes as RSM McGladrey continues to experience profitable growth. During the last quarter, H&R Block reported that the RSM McGladrey Business Services unit posted a 16 percent growth in revenues, marking the eighth straight quarter of double-digit revenue growth year over year.

New COO appointed

Coinciding with today's deal closing, RSM McGladrey also announced that Jay Brandzel will serve as chief operating officer overseeing a seamless integration of the former TBS business. He served in a similar capacity at TBS and has 30 years of accounting and business services experience. Brandzel will report to Mike Kirley, who oversees RSM McGladrey's traditional services.

Some TBS offices transferred to H&R Block

Also announced today, eight offices that were part of the TBS acquisition have transferred to H&R Block. The offices, which primarily prepare tax returns for individuals and small businesses, fit better with H&R Block Small Business Resources and H&R Block Specialty Tax Services.

About RSM McGladrey: RSM McGladrey is a leading provider of financially focused business services. The RSM McGladrey group of companies offers accounting, tax services, business consulting, retirement resources, employer services, corporate finance, wealth management and financial process outsourcing. RSM McGladrey Inc. serves clients' global business needs through its membership in RSM International (an affiliation of separate and independent accounting and consulting firms). RSM McGladrey Business Services is a wholly owned indirect subsidiary of H&R Block (NYSE:HRB).

McGladrey & Pullen LLP (a partner-owned CPA firm) delivers audit and attest services. McGladrey & Pullen and RSM McGladrey have an alternative practice structure. Though separate and independent legal entities they can work together to serve clients' business needs. When considered together, the two companies rank as the fifth largest provider of accounting, tax and business consulting.