Arthur J. Gallagher & Co. has officially entered into a definitive agreement to acquire Cadence Insurance, Inc., in a bid to enhance their presence in the southeastern and Texan markets.
The transaction, which is currently still pending regulatory approval and is expected to be completed in the fourth quarter of 2023, will enhance Gallagher’s capabilities across multiple niche practice groups, further reinforcing their expertise in areas such as Construction, Real Estate, Manufacturing, Healthcare, Professional Services, and high-net-worth personal lines.
The move brings a great deal of long-term growth prospects to the firm, as it looks to integrate the nearly 800 Cadence Insurance colleagues into Gallagher’s ever-expanding family of professionals.
In addition to the acquisition, Gallagher will become the preferred insurance broking partner of Cadence Bank, establishing a symbiotic relationship between the two entities.
Under the terms of the agreement, Gallagher will acquire the stock of Cadence Insurance for $749m, a figure that factors in Gallagher’s discounted tax benefit related to the transaction, amounting to approximately $155 million. The integration and anticipated non-cash management retention costs are estimated to total $70m over the next three years.
J. Patrick Gallagher, Jr., Chairman, President and CEO of Arthur J. Gallagher & Co., said, “Cadence Insurance is a fast-growing agency with strong niche capabilities across Construction, Real Estate, Manufacturing, Healthcare and Professional Services. With a similar culture, a high-performing team and a significant Southeastern presence there are immense long-term growth opportunities as part of Gallagher. I look forward to welcoming Markham, Chris and the nearly 800 Cadence Insurance colleagues to our growing Gallagher family of professionals.”
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