Two private equity firms - Hellman & Friedman and Valeas Capital Partners - are considering a financing maneuver that would add debt to Baker Tilly’s balance sheet and use the proceeds to pay a dividend to the owners of as much as $1 billion, according to people familiar with the matter.
The owners are reportedly seeking to carry out the dividend through a recapitalization of the accounting and advisory firm, coordinated with a wider refinancing package the firms are attempting to secure in the leveraged loan market.
If the plan moves forward, the payout would stand out in the current year. Based on compiled data, a $1 billion dividend would represent the largest dividend transaction recorded so far this year.
Under a dividend recapitalization, private equity owners extract cash from a portfolio company by increasing that company’s debt load. The new borrowing generates proceeds that are then distributed to the equity holders. In this instance, the proposed borrowing would be used to fund distributions to Hellman & Friedman and Valeas.
Baker Tilly operates as an accounting and advisory firm. The company was acquired by Hellman & Friedman and Valeas Capital Partners in a previous transaction completed in 2024.
The private equity owners are pursuing the recapitalization in concert with a leveraged loan refinancing effort, a step that suggests the ultimate outcome hinges on securing the broader debt package. Success in the leveraged loan market would be central to enabling the dividend distribution at the scale being discussed.
The discussions, as described by people familiar with the matter, center on balancing additional leverage at the firm with the objective of returning capital to the equity sponsors. Details about the proposed structure, timing, or lenders involved have not been disclosed.
Clear summary
Hellman & Friedman and Valeas Capital Partners are exploring a plan to add debt to Baker Tilly so they can pay themselves up to $1 billion in dividends via a recapitalization, to be pursued alongside a broader leveraged loan refinancing. Completion would make this the largest dividend transaction of the year, based on compiled data.