THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Tuesday, July 2, 1996 TAG: 9607020398
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY TOM SHEAN, STAFF WRITER
LENGTH: 38 lines
In its first acquisition of a major franchise in five years, the tax-preparation chain H&R Block Inc. has purchased 178 H&R Block offices in Virginia, including 58 in Hampton Roads.
The transaction with Bay Colony Ltd. was part of Block's strategy for boosting its sales and efficiency, said Brian Schell, director of corporate development at Kansas City, Mo.-based H&R Block.
The deal, which closed Friday, involved an exchange of $20 million of H&R Block stock, he said.
During the recent tax season, offices in the Bay Colony franchise prepared 152,000 tax returns, making it the second-largest franchise in H&R Block's system.
H&R Block found the Richmond-based franchise attractive because ``it was a very well-run operation,'' Schell said. H&R Block already had company-owned offices in the northern and western parts of Virginia, he said.
In addition to its offices in Hampton Roads, Bay Colony operated in the Richmond, Lynchburg and Charlottesville areas. Its roster of 178 offices included 23 offices in sub-franchises operated by six individuals, said Steven R. Dickey, former president and chief operating officer of Bay Colony.
Dickey, who became president and owner of a new eight-office franchise in Fredericksburg and three nearby counties, said Bay Colony's owners decided to sell their franchise because of estate-planning reasons.
The 200 full-time employees at Bay Colony-owned offices will remain in place, Schell said. ``We will evaluate the employees, but we have no plans to change anything,'' he said.
H&R Block, the nation's largest chain of tax-return preparers, has 8,308 offices in the United States, including 4,031 company-owned. Most of the other 4,277 are owned by 20 major franchises, Schell said. The company also operates in Canada, Australia and 15 other countries. by CNB