The Numbers Tell The Story: M&A is Hotter Than Ever Among Agencies.

An eye-opening OPTIS Data announcement reports 151 announced insurance agency mergers and acquisitions during the first quarter of 2019, i.e. one more deal than was announced in Q1 2018.

The data covers U.S. and Canadian agencies selling primarily property-and-casualty insurance, agencies selling both P&C and employee benefits, and those selling only employee benefits. The report breaks down buyers into four groups: private equity-backed/hybrid brokers, privately held brokers, publicly held brokers, and all others.

According to OPTIS, Patriot Growth Insurance Services led all buyers with 18 transactions during the quarter, including 17 closed deals to kick-off their new venture. Other top buyers were Acrisure (16), Hub (12), Gallagher (10), and Broadstreet Partners (10). Timothy J. Cunningham, managing director of OPTIS Partners, an investment banking and financial consulting firm specializing in the insurance industry, and Daniel P. Menzer, CPA, a partner with the firm, say:

* There are no signs of any changes in buyer or seller behavior, both in terms of appetite for transactions and valuations of agencies for sale.

* Individual quarterly totals can fluctuate dramatically from one period to the next and are not necessarily indicative of the overall M&A activity level

* There were only 57 unique buyers in 2019, the lowest number in any first quarter since 2014.

* Acquisitions in Canada have increased from 1-2% of the total 10 years ago to 6-8% now.

We present the data reports from OPTIS that explain plainly what is happening on Main Streets among agencies.

Highlights of 2019 YTD M&A Activity

* 151 transactions in Q1-2019, one more than Q1-2018

* 632 transactions in past 12 months

* Highest of all time, sneaking past the 631 from full year 2018

* Patriot Growth Insurance Services led all buyers with 18 transactions for the Quarter, including 17 closed deals to kick-off their new venture

* Followed by Acrisure (16), Hub (12), Gallagher (10), and Broadstreet Partners (10)

* Private Equity-Backed / Hybrid ("PE/Hybrid") responsible for more than 67% of the total transactions in the past 12 months

Summary Agency Acquisitions by Year 2015 457 2016 461 2017 611 2018 632 2017-Q1 186 2018-Q1 150 2019-Q1 151 Note: Table made from bar graph. Other Observations & Comments:

* No indications of any changes in Buyer and Seller behavior in the market, both in terms of appetite for transactions and valuations of agencies for sale

* Individual quarterly...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT