Source: Best’s News Service via Bestwire – July 20, 2018 03:42 PM

CHICAGO – Brokers in 2018 are being more selective while integrating a large number of acquisitions and mergers from last year, according to Dan Menzer, partner at consulting firm Optis Partners.

The number of broker acquisitions tracked by Optis fell in the first half of the year to 280, compared with 333 in the prior-year period.

Buyers don’t lack ability to tap into deals, Menzer told Best’s News Service. “It’s just finding the right deals for them. It is a little bit of digestion time for all the deals from last year,” notably for brokers rapidly gaining scale.

“Our gut says it’s still the same market. It’s still very active out there,” he added.

Acrisure was the most acquisitive broker in the first half of the year with 41 transactions, followed by Hub, 33; AssuredPartners, 19; Arthur J. Gallagher, 15; Alera and Broadstreet Partners, 14 each; OneDigital, 13; and NFP, 11, according to Optis tracking.

USI Insurance Services made the major deals list with its acquisition of Key Insurance & Benefit Services Inc.; Alliant Insurance Services for its acquisition of Crystal & Co.; BB&T Insurance Holdings, for Regions Insurance Group Inc.; Flexpoint Ford, which made a partial investment in Propel Insurance; Onex Corp., for a partial investment in Ryan Specialty Group; and Marsh, which recently announced plans to acquire Houston-based Wortham Insurance (Best’s News Service, June 25, 2018).

“USI has made a couple of big deals. We know they certainly take more time. That’s certainly part of the decline in the (broker transaction) count,” Menzer said. Late last year, USI acquired Wells Fargo insurance Services USA (Best’s News Service, Dec. 4, 2017).

Private equity-backed/hybrid brokers accounted for more than two-thirds of all transactions in the first half of 2018, Optis said.

Private equity firms looking to enter the space sometimes seek advice from Optis. “I tell them every seller is looking for things they don’t have. It’s not just the big paycheck. They’re all looking for resources, depth and breadth of organization,” said Menzer.

(By Renée Kiriluk-Hill, associate editor, BestWeek: Renee.Kiriluk-Hill@ambest.com)

BN-NJ-7-20-2018 1542 ET #