Arthur J. Gallagher & Co. Ramps Up Expansion With Buyouts
Zacks Investment Research | Jun 06, 2017 10:32PM ET
Arthur J. Gallagher & Co. (NYSE:AJG) has announced back-to-back acquisitions. The insurance broker recently took over Armstrong/Robitaille/Riegle, Inc., and Ann Arbor Business Advisors, LLC. in Michigan and Total Reward Group in England. Transaction details remained under wraps for both buyouts.
Kent, England-based Total Reward Group was established in 2005. The company provides remuneration support, executive search, interim placement and corporate training for reward professionals across the globe. It expects to leverage the acquired company’s compensation consulting expertise to enhance its own benefit capabilities.
Ann Arbor, Michigan-based Armstrong/Robitaille/Riegle, Inc. and Ann Arbor Business Advisors provides employee benefits, retirement planning, life insurance and human resource consulting, as well as commercial and personal property/casualty coverages. The company serves clients in Michigan and California. Hence, this acquisition is expected to add capabilities to the acquirer’s compelling portfolio.
Arthur J. Gallagher & Co.’s growth story looks impressive. The Zacks Rank #3 (Hold) insurance broker remains focused on international expansion through acquisitions and organic measures. The company’s international operations are primarily spread across Australia, Bermuda, Canada, the Caribbean, Singapore, New Zealand and the U.K.
Arthur J. Gallagher’s international operations accounts for 35% of the revenues. The company expects international contribution to total revenue to increase, given the number and size of non-U.S. acquisitions. The insurance broker’s merger and acquisition pipeline remains strong with $350 million of revenues.
Buyouts not only widen the company’s geographical footprints but also enhance its portfolio of services. Furthermore, such deals consolidate its position in retail and wholesale insurance brokerage services and risk management industries.
Shares of Arthur J. Gallagher gained 17.42% in a year’s time, outperforming the Zacks categorized Zacks Investment Research
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