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400 and counting: Gallagher aims to add acquisitions

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Global brokerage Gallagher has acquired more than 400 companies in the last decade, with Australian operations securing 25 broking businesses since the merger with OAMPS in 2014.

ben gordon
Sarah Lyons

Australian Broking CEO Sarah Lyons tells insuranceNEWS.com.au that after a comparatively quiet period caused by pandemic restrictions, Gallagher is this year ramping up its search for new acquisition opportunities.

“It is one of our four global dominant priorities,” she said.

“Covid did slow some things down as it prevented me from getting out and meeting potential merger partners. I am a big believer in cultural fit. You’ve got to know that it’s the right outcome for both of you. Face-to-face meetings to build that trust and common understanding are a critical part of the process.”

It’s a competitive market, with other international groups recently setting up local operations, but Gallagher still sees plenty of opportunity.

“We are not the only organisation who are on the acquisition trail, but we are one with a very strong value proposition,” Ms Lyons said.

“For us, it’s not just a change in ownership – we are asking people what they want to do in terms of their business, their career, their life. That’s where we have got a different solution that would suit a number of people.

“We like brokers to be brokers – they have the relationship with the client, the carriers and the community.

“By becoming part of a larger organisation you have access to a number of specialist areas, placement capability and support teams. We can take the pressure off in areas keeping principals up at night, such as claims, compliance or people matters. At Gallagher you have a bigger team you can call on to help you. Meanwhile the core fundamental of what your job was, in terms of being a broker and looking after the client, remains.”

michael lewin
Michael Lewin

Head of Mergers and Acquisitions Michael Lewin agrees that listening is key.

“We listen to the principals first and foremost. What they are looking for, what their staff are looking for, what their clients are looking for. If we don’t listen to them and understand what they want it makes it a challenge in terms of moving forward.

“We’ve got more transactions going on at the moment than we have ever had.”

Mr Lewin says Gallagher always looks to buy 100% of the target business.

“It works best when we buy the whole business, we all become colleagues. The day before they were x, y, z and the day of completion, they are Gallagher, with Gallagher systems with Gallagher computers and branded as Gallagher. I think that’s important, we need that to be seamless for them.”

ben gordon
Ben Gordon

Branch Director Corporate NSW Ben Gordon says reassuring staff was a huge part of the process when Gallagher acquired Milne Alexander, a business he was part of, in 2018.

“The staff have got a lot of questions,” he tells insuranceNEWS.com.au.

“Where did this come from? What does this mean for our clients, but also what does this mean for me as an employee?

“Gallagher did this exceptionally well, they were very transparent and engaging at that stage of the acquisition and spent a significant amount of time with our staff reassuring them.”

Being acquired by Gallagher helps progress careers, he says, including his own.

“Certainly my own career progression has come on leaps and bounds. Previously we were $40-50 million gross written premium. I now run a team that’s circa $250 million GWP and growing very fast.”

john van der vegt
John van der Vegt

National Head of Agriculture John van der Vegt says Gallagher has backed his team through some challenging times since his business was acquired three years ago.

“AgriRisk had just passed its 30 year milestone, and my business partner wanted to step back. So we started the process of how we move forward. There were a number of different options.

“We were a specialist broking operation, we didn’t want to join an AR group where we’d be literally competing for business with the other ARs.

“We wanted to be a specialist department within a significant broking operation that had a significant footprint.”

Almost as soon as the deal was done, a serious drought struck and the team’s revenues “fell in a heap”.

“But Gallagher took the long term view,” Mr van der Vegt said.

“We’ve worked our way through it. There weren’t any draconian ‘you must save costs, you must do this’. We didn’t have any of that, it was just ‘we understand the cycle, it’s a long term cycle’.”

Mr van der Vegt says one of the benefits for him as former AgriRisk MD is his ability to refocus on the customer with a lot of administrative tasks taken away from him.

“There is so much compliance, IT, marketing that you perform as the MD in a small broking house and at the end of the day you are juggling a lot of balls and maybe not doing it as effectively as you should be.

“With Gallagher you have got people that you can readily access and say ‘hey, I need some help with this’ and you haul in those resources as and when necessary. It has freed up my time and I can get on with growing the book of business rather than being bogged down with the admin.”

He says the same can be said for his team, who have voted with their feet by staying on since the acquisition to pursue their careers with Gallagher.