Willis Group Holdings plc WSH recently acquired French insurance broker, Gras Savoye. In April this year, the insurance broker decided to take over the remaining 70% stake in Gras Savoye for $590 million.
Paris-based Gras Savoye is France’s largest broker and operates in the fifth biggest insurance brokerage market. The acquisition will help Willis Group to widen its presence in France, Eastern Europe and the Middle East in addition to penetrating the fast-growing regions like Africa.
The acquisition will be accretive to 2018 earnings. The addition will bring a compelling product and service portfolio with special expertise in Construction, Natural Resources & Transport, Human Capital & Benefits, and Technology, Media & Telecommunications. However, Gras Savoye will continue to operate under its own banner.
In 1997, Willis Group bought 33% stake in Gras Savoye and eventually increased it to 49%.
The Zacks Rank #3 (Hold) insurance broker has been following the inorganic route over the last several years pursuing strategic acquisitions that not only expand and enhance its capabilities but also widen the geographical footprint. Willis Group has expanded its operations in countries like Italy, Canada, the U.K. and France.
Year-to-date, the company has taken over CKA Risk Solutions in Australia; Elite Risk Services in Taiwan; 85% stake in Miller Insurance Services LLP and its subsidiaries in London; Evolution Benefits Consulting, Inc., in Pennsylvania; Carsa Consultores, Agente de Seguros y de Fianzas de CV and its group companies, a leading insurance broker in Mexico and PMI Health Group in the U.K.
Notably, this June, Willis Group inked a deal to take over the majority stake in Towers Watson TW to become a leading global advisory, broking and solutions firm.
The inorganic route to growth seems to be a well-accepted strategy among insurers as acquisitions rage this space. Arthur J. Gallagher & Co. AJG bought The Hawk Agency, Inc. to boost its Midwest operations. Also, Brown & Brown Insurance Agency of Virginia Inc., a subsidiary of Brown & Brown, Inc. BRO bought certain assets of Ocean Marine Insurance Agency, Inc. and affiliates.
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