Archive for Tuesday, August 2, 2005

H&R Block to buy American Express division

August 2, 2005


— H&R; Block Inc. on Monday said it would buy American Express' tax and business services division for $220 million.

The company, when combined under H&R; Block's RSM McGladrey subsidiary, would have $1.05 billion in revenue, making it the fifth-largest accounting firm in the country.

Meanwhile, the Kansas City, Mo.-based tax preparer also on Monday restated its earnings for 2003 and 2004, cutting them by more than $91 million - far more than previous estimates.

The restatement, reported in a filing to the Securities and Exchange Commission, equals a decrease of 50 cents per share.

H&R; Block announced the American Express deal after the markets closed Monday. Shares lost 36 cents to $56.60 on the New York Stock Exchange. Shares have traded in a 52-week range of $45.13 to $60.

Chairman and chief executive officer Mark Ernst has said he wanted to reposition RSM McGladrey to target mid-sized businesses that he feels are ignored by the major accounting firms.


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