US brokerage giant Gallagher buys Irish insurance group Innovu

Deal provides ‘perfect Irish launch pad’ for global insurance giant, company says

Global insurance giant Arthur J Gallagher has announced its arrival in the Irish market with the acquisition of insurance group Innovu for an undisclosed sum.

The deal will see S&P 500-listed Gallagher take sole ownership of the company — with Innovu’s majority shareholder, private equity firm MML Capital Partners, exiting its investment after four years along with other, smaller shareholders. During those four years, Innovu has been one of the driving forces behind a wave of consolidation in the Irish brokerage market, having snapped up five separate brokers across the State.

Headquartered in Wexford and with offices in Kerry, Limerick, Dublin and elsewhere, Innovu now employs 135 people and boasts gross written premium of around €62 million.

Gallagher, with a market capitalisation in excess of $33 billion, is one of the biggest insurance brokers and risk management outfits in the world. In a statement on Friday, Micheal Rea, chief executive of Gallagher’s UK and Ireland retail division, said the acquisition gives the company the “perfect launch pad” in Ireland.

“I have been keen to establish a Gallagher presence in Ireland and the impressive speed at which the [Innovu] business has grown and proven itself over the last four years is testament to the entrepreneurial spirit and innovative approach of its leadership team,” Mr Rea said.

Ronan Foley, chief executive of Innovu, said the deal gives the company an “ideal platform” to continue its “ambitious plans for growth through a combination of organic and acquisition-led expansion”.

“I am delighted that we will be part of a global business that is focused on its people alongside its clients,” Mr Foley said. “We aim to establish Gallagher as the go-to broker in Ireland, and being able to draw on its global expertise and specialisms means we will be able to further support more businesses and individuals with their insurance and risk management needs.”

Shane Cooke, investment director at MML, said the private equity company was “delighted” to have worked with the Innovu team and wished them well for the future.

“We see this development as a significant opportunity for both Gallagher and Innovu and places the businesses here in a strong strategic position for the future,” he said.

The deal follows several years of unprecedented consolidation within the Irish brokerage market, which continues to attract private equity investment. Innovu, backed by MML, has been among the main driving forces behind this trend, snapping up five Irish brokers — most recently Cullen Insurances and Wexford-based PE Kelly Insurances in October last year. Over the past four years, Innovu has also acquired Sheridan Insurances, Wexford Insurances, and Goggin Insurance Brokers.

Irish company Arachas, bought by UK-based Ardonagh Group — itself backed by US private-equity outfits HPS Investment Partners and Madison Dearborn Partners — for about €250 million in 2020, has been the most active dealmaker in recent years. Since the takeover, Arachas has bought a number of brokers including sports and events specialist O’Driscoll O’Neil and Waterford-based Hooper Dolan.

UK private equity company Livingbridge acquired a majority stake in Chill Insurance in 2020 in a deal that valued the Irish business at up to €100 million. Irish-based private equity outfit Melior Capital, meanwhile, bought a majority stake in Dublin-based BHP Insurance last summer.

Ian Curran

Ian Curran is a Business reporter with The Irish Times