Sica Fletcher

APRIL 30, 2024

This article presents a step-by-step guide on how to value an insurance agency - both in the sense of how a valuation agency/M&A advisor goes about valuation, and also in terms of what insurance agency owners can do to maximize their valuation prior to running an M&A deal.

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Insurance Valuation M&A S&P 52

Sica Fletcher

APRIL 11, 2024

Your agency valuation will play a large role in influencing how buyers perceive your agency’s worth. Take time before bringing your agency to market to optimize your daily operations, thus increasing the likelihood of a higher valuation. Generally, these fall into two distinct categories of advisory firms or investment banks.

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Insurance Advisory M&A Investment Banking 52

Sica Fletcher

SEPTEMBER 12, 2024

Changes in the Valuation Process Valuation is the first formal step in the M&A deal process, taking place once the seller has gathered all their preliminary documents and made any necessary changes to the company's internal structure to make it more profitable. Family-specific financial arrangements.

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Insurance Valuation M&A S&P 52

Sica Fletcher

APRIL 2, 2024

Insurance M&A Deal Valuation, 2024 Starting out in 2024, EBITDA and revenue multiples are in a good place, experiencing modest YoY growth despite the economic downturn of the last 18 months. In deals with the highest earnout, business owners turn to a specialized M&A advisory firm to handle negotiations and oversee valuations.

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Insurance M&A S&P Broker 52

Sica Fletcher

AUGUST 6, 2024

To begin, we need to start with a few definitions: Investment Banks: We use the colloquial meaning of “investment banks,” which often includes M&A advisory firms and other financial services firms that facilitate the growth and sale of insurance agencies around a possible sale.

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Investment Banking Insurance Banking Bank 52

Sica Fletcher

MAY 8, 2024

And it certainly does not stop less-than-reputable advisory firms from agreeing to represent you and taking their regular retainer fees, despite knowing full well your agency can’t be sold. Here’s a tough fact to swallow, but it’s important that we make the statement: nearly half the agencies that owners bring to market are not sellable.

Insurance 52

Insurance M&A Valuation Advisory 52

Sica Fletcher

JULY 1, 2024

Although the seller’s goal does impact how each M&A transaction is conducted, it does not affect whether or not they need to improve their brokerage prior to the initial valuation. Selecting an Advisor Initial preparations when selling an insurance brokerage should absolutely include selecting an M&A advisory firm to represent you.

Insurance 52

Insurance M&A Advisory Funds 52

Sica Fletcher

JULY 31, 2024

With such a high level of competition, they face the double-edged sword of higher overall valuations vs. a relatively smaller initial payout as equity becomes an increasingly larger percentage of buyer offers. This has led to very high valuation multiples (~11.5x When selecting an advisor, consider the following: Reputation.

M&A 52

M&A Insurance Debt Equities 52

Sica Fletcher

MARCH 8, 2024

Starting in H2 2022, the insurance M&A market has seen a notably difficult 18-month period, afflicted with high interest rates, lowered deal volumes, and lowered valuations. If they do, then we can expect to see valuations and, by extent, EBITDA multiples for insurance agencies rise.

Insurance 52

Insurance M&A S&P Valuation 52

Sica Fletcher

JULY 11, 2024

In contrast, the equity buyers offer for your brokerage should be independently valued according to one of a few methods: Equity Valuation Methods Expect A Longer Deal Duration An M&A transaction used to take between 6-12 months, whereas the current average timeframe has expanded to between 9-18 months. Learn more at SicaFletcher.com.

M&A 52

M&A Insurance Debt Equities 52

Sica Fletcher

JULY 23, 2024

On average, brokerages that represent themselves take home 30% less than those represented by an experienced M&A advisory firm. This is because company B had a higher initial valuation of the brokerage as well as an official valuation of the equity in their company. Still Uncertain? Learn more at SicaFletcher.com.

Insurance 52

Insurance M&A S&P Valuation 52

Sica Fletcher

MAY 15, 2024

essentially boils down to three major steps: Determine your insurance agency’s EBITDA Determine the standard valuation multiple for an agency of your size Multiply your EBITDA by the multiple to determine your expected payout (i.e., Learn more at SicaFletcher.com.

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Insurance S&P M&A Valuation 52

Sica Fletcher

JUNE 20, 2024

Conversely, when interest rates are high, valuations are supposed to decrease because buyers will try to make up what they are losing to interest. Ultimately, this paved the way for PE firms to take an increasingly larger share of the insurance M&A market starting about a decade ago. for insurance agencies. for insurance agencies.

M&A 52

M&A Insurance Valuation Equities 52

Sica Fletcher

MAY 29, 2024

2) our team noted unexpected increases in the valuation multiples offered for insurance agencies, as depicted below. About Sica | Fletcher: Sica | Fletcher is a strategic and financial advisory firm focused exclusively on the insurance industry. While insurance M&A did see slight dips in deal volume and average value (Fig.2)

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M&A Insurance Equities S&P 52

Cooley M&A

NOVEMBER 20, 2023

In a challenging M&A market that is stifled by overall volatility and uncertainty, high interest rates, and reduced valuations, issues related to compensation may become more fraught as parties navigate alternative transaction structures and forms of noncash deal consideration.

M&A 52

M&A Equities Shares Advisory 52

Sica Fletcher

SEPTEMBER 25, 2019

In recent posts, we outlined the background of and reasons for the dramatic upsurge of private equity investment in the insurance brokerage industry , how the combination of private equity and low interest rates have dramatically raised valuations , and how private equity sponsored agencies increasingly dominate the insurance agency business.

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Private Equity Equities Insurance Capital 52

Sica Fletcher

DECEMBER 12, 2019

Let’s break down how this is paid: Valuation The valuation is invariably calculated as Pro Forma EBITDA multiplied by the EBITDA multiple. About Us Among the brokerage community, Sica | Fletcher is well known as the leading strategic advisory firm in the U.S.

Private Equity 52

Private Equity Insurance Equities Management 52

Sica Fletcher

SEPTEMBER 3, 2024

The following article details the process of selling an insurance agency book of business in 2024, including deviations from the process of selling an agency, the valuation process, and common payout structures. This means getting a formal valuation done - typically through your M&A advisor, but sometimes through a third party.

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Insurance Business Valuation M&A 52

Cooley M&A

FEBRUARY 8, 2018

A recap of 2017 trends and the Cooley outlook on this year’s dealmaking: Buying Innovation: Retention and Non-Competes. See ABA Private Target Mergers & Acquisitions Deal Point Study for 2016-2017. What’s on tap for 2018 M&A? For both old-line companies and tech giants, innovation is the name of the game.

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M&A Mergers and Acquisitions Mergers Negotiation 52

Software Equity Group

APRIL 4, 2023

With extremely strong financial metrics, an excellent Rule of 40 ratio , and solid EBITDA , SEG agreed we were on the right track and guided us wisely through a process culminating in the transaction to Waud Capital in 2017. Our customer marketing manager worked closely with Product, which owned our Customer Advisory Board (CAB).

Sale 52

Sale Book-building Business M&A 52

Sica Fletcher

MARCH 26, 2024

Valuation For a more in-depth examination of the valuation process, consult our previous article on the subject here. Once an agency owner completes their initial preparations, the next step is to complete a full valuation of the agency. Valuation is a process in and of itself. Account-Based.

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M&A Insurance Valuation Advisory 52

Growth Business

MARCH 1, 2024

Capital is available, valuations have started to normalise and the debt markets are still supportive – albeit with greater scrutiny and higher costs. The data below from Statista shows the volume of UK private equity deals between 2017 and 2022. Those discussions were about social impact, strategy, the marketplace and the team.

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Private Equity Equities Investment Business 59