Group CEO Tim Johnson “delighted” with Lucas Fettes and double digit organic growth.
“We have got a handful of interesting acquisitions in the pipeline,” group CEO Tim Johnson has confirmed to Insurance Age.
“The future is set fair and we would very much like to conclude those deals.”
The broker bought Birmingham-based corporate insurance broker Honour Point in April and Blackburn-headquartered Caprica Healthcare in January.
The acquisitions came after a string of deals in 2017 including marine, private client and commercial insurance broker E Coleman and Quantum Underwriting Solutions.
Skills
The most eye-catching was though the completion of the takeover of Lucas Fettes after the process had begun in 2016.
“I’m delighted with it, it has gone better than we expected,” confirmed Johnson listing the progress on the numbers, the extra complementary skills, Lloyd’s broking capability and the engagement of all staff among the successes.
After all the buys the business still has a change programme on its hands.
“We have got quite a bit of integration and embedding to do to make sure we get the return we expect and want,” he accepted.
“I’m comfortable with the businesses we have already bought and that remains as key focus.”
Fit
However, buying remains high on the agenda.
Johnson declined to name names but explained that the key criteria was finding the “right strategic fit”.
“We are not trying to fill out a geographical footprint,” he detailed adding that along with there being no map on the wall of gaps to be filled, the size of future deals was not an over-riding criteria.
“Selective acquisitions that are either high net worth private client or specialist commercial - that is our appetite,” he summed up.
The firm’s mantra is “to create the UK’s leading independent and specialist commercial business”.
Success
A pillar of the thinking is organic growth.
“We have double digit organic growth,” Johnson acknowledged. “Demonstrating this proves you are doing something right from the client perspective.”
With all the acquisitions the company has more than doubled. According to Johnson Ebitda is now tracking in the mid-to-high teens of millions and revenue has surged from £23m to around £45m.
The history of success and ongoing expansion has though put the broker in a curious position.
Aon’s purchase of Hendersons last year has left Stackhouse Poland as one of only two independent firms in Insurance Age’s Top 100 brokers supplement with gross written premium north of £100m.
In other words, there is almost no-one of their size left to buy.
“We have not mandated anyone as part of a sales process. I can tell you that categorically,” stated Johnson.
MBO
The management buyout backed by Synova Capital happened in 2014 putting the firm in the traditional three to five year sale window. There are always rumours.
“It is always flattering that you get attention because people think you are an investible business which I think we are,” Johnson concluded.
“Beyond that it is irrelevant. We are getting on with our knitting.”
For all the latest industry news direct to your inbox, sign up for our daily newsletter.