It’s less than a month into 2021 and specialist insurance intermediary PIB Group has already found the time not just to add another business to its roster, but also to be acquired itself. Earlier this week the group revealed its purchase by Apax Partners and that its long-term investor The Carlyle Group (Carlyle) will re-invest for a minority stake.
Read more: PIB Group subject to major acquisition
Discussing the acquisition with Insurance Business, Brendan McManus (pictured), who will be staying on as CEO alongside CFO Ryan Brown, highlighted the exceptional support of Carlyle since PIB began and that the decision of whom to partner with next was a serious undertaking. Brown and McManus seriously considered the options available, he said, and Apax was a clear front-runner.
“Then at the end of the year, the co-CEO of Apax called us and offered to pre-empt and try to avoid the [entire re-financing] process,” said McManus. “And those processes are quite disruptive, they take three or four months and management can’t do anything other than focus on the sale of the business. So to do something quickly with a partner who we already knew and trusted seemed the right thing. We started in the middle of December and did the whole thing in six weeks.
“And, while I can’t say it’s been fun, because I don’t enjoy these kinds of processes and it’s been really hard work for all the team… at the end of it, we’ve got a phenomenal partner that’s a serial investor in broking. [Apax] have owned some of the biggest brokers in North America, and they really understand the sector. It’s great to have people that are very knowledgeable about what we do because I think it makes the day-to-day relationships a lot easier when everybody understands.”
McManus noted that what this deal means for PIB is a continuation of the strategy which has proven to work well for the group. That strategy is to focus on specialist segments of general insurance, he said, mainly in the commercial space, whether that’s retail or wholesale. Where this has changed recently is that, while PIB has a number of such businesses in the UK, the focus has increasingly turned to the internationalisation of the group’s offering.
Last year, PIB bought businesses in Ireland, Poland and Germany and now its gaze is expanding to include other locations in Europe. This expansion utilises a dual approach. Either the new location offers strong consolidation opportunities, such as those offered by Poland and central Eastern Europe, or it offers organic growth opportunities.
“We’re investing in brokers who are focused on a sector that could give us really good organic growth,” he said. “So, our business in Germany mainly focuses on renewable energy and we think we can see probably 30 years of organic growth out of that business. And it has done really well during the COVID disruption because people are still building wind farms and looking at anaerobic respiration and so on.”
The ambition for the group, he said, is not to become a global brokerage or to plant a flag in every country, but instead to serve its global clients well and to be close to where it believes the real opportunities for growth reside. The slight problem at the moment, of course, is the lack of business travel, with these partnerships instead being formed over digital communication channels. While these work well, they’re just not the same as being face to face, and McManus looks forward to the day everybody can start travelling again.
Looking to 2021, he said, he anticipates that PIB will hit the same pace of growth in acquisitions that it did last year, and he revealed that the group has already lined up a solid pipeline of purchases. There’s a number of deals in diligence and more besides those that the business is steadily working on.
“So, we will expect by the end of this next year to be in more countries and to have more development activity there,” he said. “We’ve got a very good young CEO in Poland who we’re excited to work with, and he’s got a great pipeline of opportunities. And we’ve got another country where we expect to do something this year, in which we’ve got a very exciting team and a whole pipeline to go out. So, it’s going to be fun.”
