Global insurance broker Gallagher has entered the fast-consolidating Irish market with the purchase of Innovu, a private-equity backed brand that has been buying local brokers for the last four years.
he deal, estimated to have cost Gallagher in the region of €30m, will establish a presence on the ground for the US-based broker, which already has a large operation in the UK.
“The acquisition of Innovu Insurance provides the perfect launch-pad into Ireland,” said Michael Rea, CEO of Gallagher’s Retail Division, UK & Ireland.
It is the latest in a series of recent transactions in the sector as large brokers and private equity funds buy up smaller players with good income profiles and strong customer relationships.
Innovu was founded in 2018 by chief executive Ronan Foley and backed by private shareholders and private equity firm MML Growth Partners to acquire Sheridan Insurances, one of the largest broker groups in the north-east.
The company quickly built scale through a series of further acquisitions of regional brokers, including Wexford Insurances, Goggin Insurance Brokers, Cullen Insurances and PE Kelly Insurances.
Innovu’s 135 employees serve a customer base of 45,000, giving Gallagher a firm foothold in a market that is experiencing significant mergers and acquisitions activity.
The company made €7.9m in revenue in 2020, the most recent year for which accounts are available.
Quote Devil, the low-cost broker that was sold to the private equity group behind Chill Insurance in April, had €6.8m in revenue the same year and sold for €30m, according to figures disclosed in a recent court case.
Other big deals in the last year include sales of Chill Insurance and Gallivan Murphy – both for €100m – and numerous bolt-on acquisitions by Irish group Arachas and UK broker Aston Lark.
Private equity and large international brokers are on the hunt for more deals here thanks to a highly fragmented market that is facing cost pressures from regulation.