Arthur J. Gallagher Acquires Affiliated Benefit Consultants
Zacks Investment Research | Feb 16, 2020 09:50PM ET
Arthur J. Gallagher & Co. (NYSE:AJG) has acquired Affiliated Benefit Consultants, Inc., which offers brokerage and consulting solutions to employers who are looking to take charge of their benefit programs. The details of the transaction have been kept under wraps.
Oakbrook, IL-based Affiliated Benefit Consultants was established in 1986. The company caters to clients throughout the United States, providing them with a full suite of benefits consulting services.
Affiliated Benefit Consultants is a strategic fit for Arthur J. Gallagher. This growth-oriented benefit consultant will boost brokerage and consulting services of the acquirer.
The recent buyout is the sixth for Arthur J. Gallagher in the first quarter of 2020. A strong capital position along with solid operational performance should continue to back Arthur J. Gallagher in its inorganic efforts.
Given the insurance industry’s high capital level, companies are aggressively pursuing mergers and acquisitions. Arthur J. Gallagher’s inorganic pipeline remains strong with revenues of about $250 million, associated with 50 term sheets either agreed upon or being prepared. In 2019, the company completed 49 mergers with more than $468 million of annualized revenues. These acquisitions provide it with incremental capabilities and services that benefit clients in Australia, the UK, Europe and the United States.
Recently, there have been a number of acquisitions in the insurance brokerage industry, given the significant capital available. Brown & Brown’s (NYSE:BRO) subsidiary, Hull & Company, LLC acquired the assets of All Risk General Agency, Inc., Select General Agency, LLC, TARGA Investment Corporation, TARGA Premium Finance Company, Inc., and Texas All Risk General Agency, Inc., collectively known as Texas All Risk.
Shares of this Zacks Rank #3 (Hold) insurance broker have gained 36.7% in the past year, outperforming the Original post
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