Two award-winning Atlantic Canada brokerages have merged in a deal motivated by the commitment of both brokerages to the independent broker channel.
Archway Insurance, one of Atlantic Canada’s largest independently-owned insurance brokerages with roughly 50 employees, has purchased all of the outstanding shares of SNC Insurance Brokers Limited for an undisclosed amount.
Located on Herring Cove Road in Halifax, SNC Insurance is a 14-person operation that offers insurance services for individuals, organizations, and entrepreneurs.
News of the acquisition comes just one week after IBANS named SNC Insurance as its 2013 Brokerage of the Year. Archway Insurance was named the CAFE Nova Scotia Family Enterprise of the Year in 2013.
The acquisition of SNC brings the total number of Archway locations to nine – spanning Yarmouth, Nova Scotia to Miramichi, New Brunswick. Over the past decade, Archway has purchased 15 brokerages across Nova Scotia and New Brunswick, quietly amassing a substantial presence and market share. The deal with SNC is Archway’s single, largest brokerage purchase.
“I think this should send a clear message to companies purchasing agencies that independents can make larger deals and, given the opportunity, they will make the larger deals,” said Michael Stack, vice president of Archway. (continued.)
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“It’s an absolute myth that [directs] are the only ones who can pay you fair dollar for your agency. I think as independents we need to talk more about deals like this, so people are aware that independent options – with the same financial result for the seller – are available through the channel that you’ve always talked about supporting.”
Stack said a number of different funding partners stepped forward to help finance the deal. “Most of these markets are interested in maintaining their books of business and seeing the independent channel carry on.”
SNC President Stewart Hay said the brokerage recognized 18 months ago that it would need to make a decision about its future.
“There are various options when you are selling,” Hay said. “Over the past several years, we had looked at options such as purchasing and merging. At the end of the day, we decided the best thing for this brokerage would be to find a suitable buyer.”
Hay said the people at SNC had known the Stack family for about 15 years and had been involved with the Archway Group over the past couple of years. “We had the highest regard for the family, so we approached them and said: ‘We would like to sell to you. We’re not putting the office on the market.’ And it was one of the most amicable, straightforward acquisitions you could ask for.”
Hay will work as a consultant with Archway, providing continuity for clients, and sharing his commercial expertise. SNC CEO Carolyn James will stay on temporarily to assist with the management transition from SNC to Archway.
Hay said SNC will maintain its brand name and conduct business as usual. SNC business breaks down as approximately 75% personal lines, with the balance being a mixture of commercial business.
