Arthur J. Gallagher & Co is buying fellow multinational intermediary AssuredPartners for $13.45bn, approximately £10.56bn, from private equity firm GTCR.
Gallagher said it expected to save around $160m through synergies between the firms over the next three years.
Meanwhile, the integration will cost approximately $500m including $200m of non-cash retention awards.
A spokesperson for Gallagher told Health & Protection it expected all AssuredPartners employees to transition over to Gallagher following the deal.
Florida-based AssuredPartners is the 11th largest insurance broker in the US, with a team of 10,900 professionals, serving clients from 400 offices across North America and the UK.
In the UK and Ireland the AssuredPartners International branch has more than 30 locations while there is a European office based in Brussels.
At an investor presentation, Gallagher said it initially estimated earnings before interest, taxes, depreciation, and amortisation (EBITDAC) savings of approximately $160m.
This is comprised of around $60m related to commission rate adequacy, premium finance or fiduciary interest income and the use of internal wholesalers.
It also said it expects to save around $100m related to efficiencies by using the Gallagher Center of Excellence, real estate and various operating expense savings.
Through its network of agencies, the firm provides advice on protection, health and employee benefits to individuals, commercial enterprises and public institutions.
The transaction is expected to close in the first quarter of 2025, subject to regulatory approvals and customary closing conditions.
‘Significant milestone’
AssuredPartners was founded in 2011 by insurance industry veteran, executive chairman, Jim Henderson.
Since launch, the company has acquired and successfully integrated over 500 businesses. GTCR originally sold the company to Apax Fund VIII in 2015, and GTCR reacquired a majority stake in partnership with Apax Fund IX in 2019. Today, it is led by Henderson and CEO Randy Larsen.
David Donnini, managing director and head of business and consumer services at GTCR, said: “The sale marks a significant milestone in the company’s journey of building one of the leading insurance brokers behind an ambitious strategy of transformational growth.
“We are incredibly proud of the partnership we developed with Jim and the entire team at AssuredPartners, and the platform that was built over 13 years.
“The company has a well-earned reputation for prioritising culture, collaboration and client service, which has made it a great fit for so many agency partners and allowed Assured to scale at such an impressive pace.
“We look forward to seeing Assured and Gallagher’s continued success.”
Henderson said: “Today’s news is the culmination of a tremendous effort on the part of the entire AssuredPartners team and we are excited about the future of the business.
“We have enjoyed working with GTCR over the past 13 years and, on behalf of the team, I want to thank GTCR for its commitment to our vision and for all of their support along the way.”