Arthur J. Gallagher & Co. AJG recently acquired Ashton Tiffany LLC. The terms of the transaction have not been revealed yet.
Phoenix-based Ashton Tiffany, founded in 1995, is a full-service risk program administrator providing services in Arizona. It focuses on developing and managing public entity risk pools, leveraging its exclusive administrative tools. The acquisition of Ashton Tiffany will thus boost the acquirer’s position as a risk program administrator.
This marks the company’s first buyout in 2021. Last year, the company closed 26 mergers. Its merger and acquisition pipeline is quite strong with about $350 million revenues associated with nearly 40 term sheets either agreed upon or being prepared.
Strategic acquisitions help the acquirer strengthen its footprint, penetrate new markets as well as add capabilities and boost product and service offerings. A strong capital position enables Arthur J. Gallagher to engage in strategic initiatives that position it for growth. This Zacks Rank #3 (Hold) insurance broker targets about $1.5-$1.6 billion of mergers and acquisitions with free cash and debt.
Arthur J. Gallagher remains focused on long-term growth strategies for delivering organic revenue improvement, apart from making strategic mergers and acquisitions. It is also focused on productivity improvements and quality enhancements that should help it deliver sustained operational excellence.
Shares of Arthur J. Gallagher have gained 26.1% in a year compared with the industry’s 1.2% increase. Efforts to ramp up its growth profile and capital position should continue to drive share price higher.
There have been a host of acquisitions in the insurance space of late, given significant capital availability. Assurant (NYSE:AIZ) AIZ acquired EPG Insurance to consolidate its presence in the automotive service contract space. Brown & Brown, Inc.’s BRO subsidiary Brown & Brown Dealer Services acquired considerably all ADM Marketing Group, Inc. and its affiliate ADM Insurance Services, Ltd. Marsh & McLennan Companies, Inc.’s MMC unit Marsh & McLennan Agency LLC (MMA) recently acquired the independent agency INSPRO in Nebraska.
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