Markel Inks A Deal To Invest In Combined Lansing & Harvey
Zacks Investment Research | Mar 17, 2020 06:11AM ET
Markel Corporation (NYSE:MKL) has inked a deal to acquire majority stake in Lansing Building Products. Concurrently, Lansing Building Products has agreed to acquire the distribution business of Harvey Building Products (Harvey Distribution). Both deals, following the fulfillment of customary closing conditions, are projected to close by the end of April. The financial terms of the deal and the amount of Markel’s ownership stake were not made public.
Lansing Building Products is a supplier of exterior building products with 77 locations in 25 states. It caters to about 60,000 customers, mostly building contractors and professional home renovators across the United States and remains focused on the delivery of superior service.
Waltham, MA-based Harvey Building Products assists a variety of contractors and building industry professionals across the Northeast. It is a vertically-integrated manufacturer and distributor of windows and doors in addition to other exterior building products.
The buyout of Harvey will boost geographic presence and scale of Lansing. As a combined entity, Lansing Building Products will operate 113 branches in 35 states.
Lansing Building Products had set a goal to increase annual revenues from about $600 million to $1 billion by 2025. The goal looks achievable as Lansing and Harvey Building Products had combined sales of $1.1 billion in 2019.
Some of Markel’s notable deals include the acquisition of online freelancer and contractor business of commercial insurance brokers, Caunce O’Hara & Company Ltd. in November 2019. It also entered into an agreement to buy VSC Fire & Security, Inc. In November 2018, it had expanded Insurance-Linked securities with the Nephila buyout.
Shares of this Zacks Rank #2 (Buy) insurance broker have lost 15.9% compared with the industry ’s decline of 16.6% in the past year. Nevertheless, the company’s policy of ramping up its growth profile and capital position is likely to help the stock regain momentum.
Other Stocks to Consider
Some other top-ranked property and casualty insurance stocks are Donegal Group, Inc. (NASDAQ:DGICA) , CNA Financial Corp. (NYSE:CNA) and First American Financial Corp. (NYSE:FAF) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Donegal Group surpassed estimates in the last four quarters, the positive surprise being 271.06%, on average.
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CNA Financial surpassed estimates in the last four quarters, the positive surprise being 9.39%, on average.
First American Financial surpassed estimates in the last four quarters, the positive surprise being 17.68%, on average.
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