(Marketwire) - J. Powell Brown, Chief Executive Officer and
President of Brown & Brown, Inc. (NYSE: BRO), today announced
that Brown & Brown, Inc. has entered into an agreement to
acquire the parent company of Arrowhead General Insurance Agency,
Inc. ("Arrowhead"), a national insurance program manager and one of
the largest managing general agents (MGAs) in the property and
casualty insurance industry, from Spectrum Equity Investors, JMI
Equity and a management equityholder group. The transaction is
expected to close in January 2012 and is subject to customary
closing conditions, including regulatory approval. The transaction
will be a cash transaction and is not subject to financing
On Friday, December 16, 2011, J. Powell Brown, J. Scott Penny,
Regional President and Chief Acquisitions Officer, and Cory T.
Walker, Senior Vice President and Chief Financial Officer of Brown
& Brown, Inc., along with Arrowhead senior executive officers
Chris L. Walker, D. McDonald "Mac" Armstrong, and Stephen "Steve"
Bouker, will host an investor update conference call concerning
this transaction. You are invited to listen to the call, which will
be broadcast live on Brown & Brown's Internet site at 9:00 a.m.
ET. Simply log on to www.bbinsurance.com and
click on "Investor Relations" and then "Calendar of Events." A
presentation containing additional material regarding the
transaction will also be available at this link.
If you are unable to listen during the live webcast, audio from
the conference call will be available commencing two hours after
the end of the live broadcast until midnight (ET) on Sunday,
January 15, 2012. To access this replay, dial 1-888-203-1112 or
1-719-457-0820 and, when prompted, enter replay access code
4612161. Audio will also be archived on Brown & Brown's
website, www.bbinsurance.com, for 60
days after the live broadcast. To access the website replay, go to
"Investor Relations" and click on "Calendar of Events." Windows
Media Player software and at least a 28.8 kbps connection to the
Internet are required to access and listen to this broadcast.
Arrowhead, together with its subsidiary, American Claims
Management, Inc. ("ACM"), a third-party claims administrator, and
its other subsidiaries, is expected to have total annual 2011 net
revenues of approximately $105 million.
As part of this transaction:
- Chris Walker, Chief Executive Officer of Arrowhead, will be
named a Regional Executive Vice President of Brown & Brown,
Inc. and will also continue to serve as CEO of Arrowhead.
- Mac Armstrong, Arrowhead's current Chief Financial Officer and
Chief Operating Officer, will be promoted to President of
- Steve Bouker has elected to focus his energy on leadership of
the Residential Earthquake Program, which he created for Arrowhead,
and will continue as President of that division.
- Lewis DeFuria will continue to serve as President of Special
Risk for Arrowhead.
- Stephen Boyd will continue to serve as President of Arrowhead's
- Scott Marshall will continue to serve as President of ACM.
- Messrs. Walker, Armstrong, Bouker, DeFuria, Boyd, and Marshall
will also join Brown & Brown, Inc.'s Leadership Council.
Arrowhead and ACM will continue to operate in their current
locations in the greater San Diego, California area. Alexander
Anthony Insurance, LLC, an Arrowhead subsidiary, will continue to
operate in its Salt Lake City, Utah location.
Powell Brown stated, "This transaction brings many exciting
opportunities to Brown & Brown. We believe Arrowhead has built
a strong management team and an organization that enjoys an
excellent reputation within the industry. The addition of Arrowhead
to our Programs Division should significantly expand the breadth
and depth of our insurance carrier relationships and the products
and services we can offer our distribution partners." He also
noted, "It is expected that this transaction will increase our
total annual revenues and number of team members by approximately
Chris Walker said, "The Arrowhead team is thrilled to be joining
Brown & Brown. We believe the entrepreneurial, results-driven
culture of Brown & Brown is a perfect fit for Arrowhead. We
look forward to continuing our successful, profitable growth with
our producers and carrier partners with the enhanced resources and
talent of Brown & Brown at our side."
The purchase price is $395.0 million, subject to adjustments for
certain items such as Arrowhead's working capital, debt and net tax
operating losses. An additional payment of up to $5.0 million may
be made three years after closing, depending on Arrowhead's EBITDA
during the last year of that period.
Brown & Brown, Inc., through its subsidiaries, offers a
broad range of insurance and reinsurance products and related
services. Additionally, certain Brown & Brown subsidiaries
offer a variety of risk management, third-party administration, and
other services. Serving business, public entity, individual, trade
and professional association clients nationwide, Brown & Brown
is ranked by Business Insurance magazine as the United States'
seventh largest independent insurance intermediary. Brown &
Brown's Web address is www.bbinsurance.com.