Arthur J Gallagher & Co (AJG), a US-based insurance brokerage and risk management services firm, has purchased an independent commercial insurance broker Oval Group of Companies, in a transaction valued at nearly £199m in cash.
Gallagher expects to finance the transaction using free cash and borrowings on its line of credit. The acquired business had £80m in annualized revenue and manages 24 offices across the country.
Commenting on the acquisition, Arthur J Gallagher & Co chairman, president and CEO J. Patrick Gallagher, Jr., said, "Oval will significantly expand our retail distribution and firmly positions Gallagher as a top three U.K. retail commercial broker operating from 70 locations."
"Our combined operations will also make us the largest retail broker in several key U.K. locations.
"With the addition of over 1,000 Oval associates, we will add extensive expertise and experience to our upper and middle-market client capabilities."
Arthur J Gallagher believes that the acquisition will significantly expands its retail client base in the UK middle-market, while new locations will boost its footprint in the country.
Furthermore, the takeover will provide cross-selling opportunities across the combined network and drive longer-term operational efficiencies through an integrated platform.
Peter Blanc will head Gallagher’s combined UK retail division, and Oval’s benefits and wealth management business will become part of Gallagher’s UK-based benefit and consulting specialist operations, managed by Tim Johnson.
Arthur J Gallagher & Co operates in 25 nations and offers client-service capabilities in more than 140 countries globally, leveraging a network of correspondent brokers and consultants.
Image: Arthur J Gallagher & Co corporate headquarters in Itasca, Illinois. Photo courtesy of: Arthur J. Gallagher & Co. 1999 -2014.