Penta pauses Sumer sale plans as accounting sector valuations come under pressure – report

Penta Capital Partners has shelved plans to launch a sale of UK accountancy group Sumer at a valuation of about £1bn ($1.35bn), despite attracting interest from prospective buyers, reported The Times.

The buyout firm had hired corporate finance adviser Continuum in 2024 as investor demand for professional services businesses intensified.

Market participants had expected a formal auction, but that process has not started.

Penta is now assessing other ways to generate returns from its investment while continuing to back the business.

Among the alternatives under consideration is a continuation fund, under which Penta would transfer Sumer into a new investment vehicle.

That structure would allow some existing investors to cash out while enabling the firm to keep hold of the asset for longer.

A new investor could also be brought in alongside Penta.

Another possible route is a dividend recapitalisation, which would involve adding debt to the business to fund a payout to shareholders.

People close to the matter said a full sale remains possible if market conditions recover.

Sumer and Penta refused to comment on the news.

Sumer, founded in 2023 by former KPMG executive Warren Mead with Penta’s backing, has expanded through acquisitions and is said to be the UK’s 12th-largest accounting firm.

The group generates around £300m in annual revenue, employs about 3,000 staff and primarily serves small and medium-sized businesses.

Unlike some consolidation platforms, Sumer generally leaves acquired firms operating independently and under their existing brands.

Potential bidders are said to have examined the business, though some questioned the proposed valuation.

Still, one source said interest from private equity firms remained “healthy” should Sumer eventually be put up for sale.

The move comes amid a broader reassessment of values in the accounting roll-up market.

“About 12 months ago they were achieving super-high valuations, which now look ludicrously high,” one person familiar with the sector said.

“You don’t know what cashflows in three years are going to look like because you don’t know the impact AI is going to have.”