H&R; Block to Acquire McGladrey & Pullen

H&R; Block Inc., the world’s largest tax preparer, said it will pay $290 million for accounting firm McGladrey & Pullen’s non-audit business, expanding its accounting and consulting practice fourfold as it builds a full-range financial services company. The transaction would make H&R; Block the nation’s sixth-largest accounting firm, with about $400 million in revenue. It would be the largest accounting firm acquisition and the first combination of its kind between a large financial services company and a top 10 accounting firm, the firms said. “It launches H&R; Block as a major player in the accounting services arena,” said Peter Heckmann, an analyst at George K. Baum & Co. H&R; Block, founded in 1946 by brothers Henry and Richard Bloch in Kansas City, Mo., would pay $240 million in cash over four years for the seventh-largest U.S. accounting firm. It would assume about $50 million in pension liabilities and make further payments tied to performance. The purchase of Minneapolis-based McGladrey & Pullen would give H&R; Block accounting offices nationwide serving mid-size companies. H&R; Block shares fell 31 cents to close at $49.31 on the New York Stock Exchange.