New York State Agency Deal

dandoran — Tue, 16 Jun 2009 22:00:00 +0100

Two New York state independent agencies recently announced a transaction. The Riverfront Agency was recently acquired by Frank H. Reis, Inc. Riverfront is a P&C shop with approximately $5m in premiums.

Interestingly, this deal is the first P&C deal in New York state that we've seen in some time - but probably falls in line with the significant uptick in insurance M&A activity during the second quarter in general.

What Will Happen With Benefits?

dandoran — Fri, 12 Jun 2009 22:00:00 +0100

This is the question that we are getting day in and day out. Our take (in short): something is going to happen, but not the sweeping changes that the administration is looking for. As a general statement, we don't see a wholesale impact on benefits / H&L shops out there.

Of note, the bigger impact that we are seeing right now groups evaporate as companies shut down - certainly a regionally clustered phenomenon with heavier losses in "rust belt" [...]

AJG Acquires Walker

dandoran — Tue, 09 Jun 2009 22:00:00 +0100

Arthur J. Gallagher recently announced the acquisition of the Walker Taylor Agency, a North Carolina P&C shop. Work is a notable agency with a long history - dating back some 140+ years. As outlined, current management will remain in place going forward.

Notable Ohio P&C Deal

dandoran — Mon, 08 Jun 2009 22:00:00 +0100

Brower Insurance, the largest P&C broker in the Dayton market, recently announced the acquisition of Benchmark Insurance. Interestingly, this is the second deal for Brower inside of the last 6 months- although they note that they do not plan any further deals.

Marketing an Agency for a Transaction

dandoran — Tue, 14 Apr 2009 22:00:00 +0100

Marketing an Agency for a Transaction

Here is a question that we often get asked: how do you market a company? While the answer invariably is “it depends” – we’re outlining below some of the general steps that we take.

One note: it’s a generally accepted principal that a deliberate approach resulting in an offer received through a bid process is likely to be 20% higher than an “unsolicited offer.” Why would that be? Likely [...]

Reasons Agency Owners Sell

dandoran — Tue, 14 Apr 2009 22:00:00 +0100

In our line of business we hear a lot of motivations behind “doing the deal.” In our experience, the best reasons often include joining a bigger team, gaining access to more resources, and continuing to grow your net income post closing. Access to more / better markets and less administrative duties can be a powerful motivator for a top producer.

But what about those that want to exit or retire? Below are some stress points that we see come up time and again.

Upcoming Webinar: Insurance M&A for Sellers

dandoran — Sun, 01 Mar 2009 22:00:00 +0100

Sign Up for our upcoming webinar...

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Gallagher Announces Acquisition of Fidelity Benefits

clearrock — Sun, 15 Feb 2009 22:00:00 +0100

Arthur J. Gallagher recently announced the acquisition of Fidelity Benefits & Insurance Services of Waco, Texas.

The transaction continues the trend of Benefits transactions outpacing those on the P&C side, as well as the pace of consolidation in the Texas marketplace.

Texas Agency Powter Acquires O'neal

clearrock — Sun, 15 Feb 2009 22:00:00 +0100

Powter Insurance, a north Texas P&C agency, recently announced the acquisition of O'neal Insurance. O'neal is a P&C and benefits agency also located in north Texas.

Gallagher Acquires PartnerSource

clearrock — Sun, 15 Feb 2009 22:00:00 +0100

Arthur J. Gallagher announced that they have acquired PartnerSource, Inc.- a Texas based broker.

Notable in the transaction is Gallagher once again buying into niche segments- PartnerSource is benefits agency with a particular focus on non-subscription programs.

We continue to see benefits agencies get attention in the current M&A environment, with "nichey" specialty companies attractive as differentiators to acquirers. While market share is nice, [...]

The Changing Face of Insurance M&A

clearrock — Wed, 11 Feb 2009 22:00:00 +0100

Now that we are clearly in the midst of a recession - no matter what metric you use or person you ask - the common theme of questioning has predictably drifted from “what will happen” towards “how far will it go” and “how long will it last.”

Clearly the broader economic environment is going to have an impact on the insurance world- and hence insurance M&A. From an economic standpoint, we believe that those two questions go a long way to sh [...]

Winter Insurance Newsletter Published

clearrock — Mon, 09 Feb 2009 22:00:00 +0100

Clear Rock's Winter Insurance M&A newsletter is now available for download.

Inside we touch on a number of subjects, to include:

Changing Face of Agency M&A's
Where have bank buyers gone?
Big AJR, USI deals

Download the Insurance M&A Newsletter

Writedowns... Explained

clearrock — Mon, 09 Feb 2009 22:00:00 +0100

One can't go an hour or two during this earnings season without hearing about yet another large write-down from a public company. On the private side, though, most smaller companies rarely take write downs- so we thought the concept might bear some explanation:

Benefits Agencies: Why They�re Hot

clearrock — Wed, 04 Feb 2009 22:00:00 +0100

The numbers from 2008 clearly bear out the trend: benefits agencies are moving at a faster rate than traditional P&C shops.

While the reasons are manifold, one key factor is the availability of solid agencies for traditional P&C buyers. After a several-years long buying spree, many of the best shops have been absorbed by banks and public brokers.

When combined with the soft P&C market, we see a gravitation towards the benefits side. The need to div [...]

Blockbuster Deals for AJR, USI

clearrock — Mon, 02 Feb 2009 22:00:00 +0100

Many thought that Arthur J. Gallagher and USI had been unusually quiet in during the end of 2008- but apparently they were both busy wrapping up a blockbuster deal with Liberty Mutual.

Both companies acquired the renewal rights and certain employees from Liberty’s middle market P&C group.

Interesting, here, is Liberty shedding their captive distribution channel. While they open themselves up to some competition, it stands to reason they get a broader [...]

Toxic Assets... Effecting More Than Just Wall Street

clearrock — Thu, 22 Jan 2009 22:00:00 +0100

As we head into earnings season (and into a new administration) we arebound to hear more and more about "toxic assets" and how they are impairing recovery for banks - and the economy as a whole.

Here is a little more on just what "toxic assets" means:

Current Insurance M&A Valuations

clearrock — Thu, 04 Dec 2008 22:00:00 +0100

We just wanted to provide a current glimpse at the insurance broker / agency M&A market. It's a question that we get asked time and again: what types of valuations are people paying?

Our experience is that, even in the current market, deal multiples have not suffered significantly. We have a series of transactions priced between 1.5x to 2.0x commissions. From an EBITDA perspective, valuations are still pricing at 6x EBITDA and above. And again, these are deals closing in Dece [...]

Deal By Christmas

clearrock — Sat, 08 Nov 2008 22:00:00 +0100

Clear Rock has several buyers that are seeking to squeeze in a deal to buy an insurance agency before the Holidays.

Now that the election is over, and it seems more likely that capital gains taxes will rise in the next year, it is a great time to take advantage of not only getting a deal done, but also allocating a portion of the price at the historically low 15% long term capital gains rate.

As you can imagine, the timeline is getting tight. If you are in [...]

More AIG Troubles

clearrock — Wed, 08 Oct 2008 22:00:00 +0100

Last night the Fed announced another $38bn infusion into AIG. Curious, of course, is how they decided to word the transaction: the Fed is "borrowing" certain assets in return for "cash collateral." While a cash collateral is a perfectly legitimate transaction structure, we believe that this is just a cumbersome attempt to obscure a second recapitalization of AIG in under 2 weeks.

Granted, since the Fed effectively owns AIG at this point, we imagine its within the [...]

Credit Crisis Explained: Part 2

dandoran — Mon, 06 Oct 2008 05:06:51 +0100

So we continue to hear about the credit crisis - and a lot fo that talk continues to center around the commercial paper market. When we hear problems about liquidity in the market, etc. the reference is often to this short term paper market - not the longer term loans and lines of credit that middle market companies rely on.

So what is commercial paper? And why is it important? Simply explain, its a short term loan used to finance operations. Although it can take several forms, it [...]

Blog Entries

New York State Agency Deal

What Will Happen With Benefits?

AJG Acquires Walker

Notable Ohio P&C Deal

Marketing an Agency for a Transaction

Reasons Agency Owners Sell

Upcoming Webinar: Insurance M&A for Sellers

Gallagher Announces Acquisition of Fidelity Benefits

Texas Agency Powter Acquires O'neal

Gallagher Acquires PartnerSource

The Changing Face of Insurance M&A

Winter Insurance Newsletter Published

Writedowns... Explained

Benefits Agencies: Why They�re Hot

Blockbuster Deals for AJR, USI

Toxic Assets... Effecting More Than Just Wall Street

Current Insurance M&A Valuations

Deal By Christmas

More AIG Troubles

Credit Crisis Explained: Part 2