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NEW YORK - Private equity firm Kelso & Company has completed the sale of its portfolio company Accession Risk Management Group to Brown & Brown, Inc. (NYSE:BRO) for approximately $9.83 billion, primarily in cash, according to a press release statement issued Wednesday.
The transaction represents one of the largest full private equity exits in insurance brokerage history, following Accession’s growth under Kelso’s ownership since 2015.
Boston-based Accession, formerly known as Risk Strategies, operates through two subsidiary brands: Risk Strategies, a retail insurance brokerage, and One80 Intermediaries, an insurance wholesaler and program manager established in 2019.
During Kelso’s ownership period, Accession expanded through both organic growth and more than 180 acquisitions, increasing revenue from $130 million to $1.7 billion. The company grew from 500 employees to approximately 5,500 professionals. This acquisition adds to Brown & Brown’s impressive track record, which includes revenue of $4.96 billion in the last twelve months and a consistent dividend payment history spanning 40 years. Get deeper insights into Brown & Brown’s growth strategy and financial metrics with a comprehensive Pro Research Report, available exclusively on InvestingPro.
"We are incredibly proud of Accession’s extraordinary growth and success," said Steve Dutton, Partner at Kelso & Company, in the press release.
John Mina, CEO of Accession, stated, "Over the course of nearly 30 years, Accession has advanced an innovative, specialist approach to risk management that has put our customers and associates first."
Accession’s founder and Executive Chairman Michael Christian, who launched Risk Strategies in 1997 and served as CEO until 2019, expressed gratitude to the company’s leaders, associates, and partners at Kelso.
Evercore Inc. acted as financial advisor to Kelso and Accession, while Debevoise & Plimpton LLP served as legal counsel for the transaction.
In other recent news, Brown & Brown has been in the spotlight following the release of its second-quarter earnings report. The company reported organic growth of 3.6%, which fell short of the industry average of 4.7%, prompting Wells Fargo to downgrade its stock rating from Overweight to Equal Weight. In response to growth concerns, Keefe, Bruyette & Woods (KBW) has also lowered its price target for Brown & Brown to $87, citing expectations of slower organic growth and increased expenses. In a strategic move, Brown & Brown has acquired the assets of Tire Shield, a company specializing in administrative services for tire and wheel road hazard products, to enhance its dealer services. Despite the acquisition, Truist Securities reduced its price target to $120 due to the company’s exposure to the Florida property market downturn, though they maintain a Buy rating. BMO Capital also adjusted its price target to $106, describing the recent stock price drop as "overdone." These developments highlight the mixed outlook on Brown & Brown’s financial health and strategic direction.
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