We have been speaking to our network of private insurance agencies, and it’s clear that some of our sellers are worried about recent news reports. While it’s true that the media has been warning about a softening market, global instability, and rising inflation, there are segments of middle market M&A that are prime investment opportunities. For our sellers, you should know that by delaying your exit from the market, you may be sleeping on an ideal time to sell.
The reality is that lower and middle market insurance M&A have robust liquidity. It’s nearly a certainty that that liquidity will decrease, but because we’re not there yet, this is the time to make your move.
Investment in mid-sized and small independent insurance agencies remains an appealing revenue stream, so if you’re ready to sell your agency, we have good news: interested buyers are still making deals every day.
The current landscape of climbing interest rates and rapidly increasing inflation will cause some buyers to approach acquisitions with caution, but so far, we have found that prepared middle-market buyers are not being deterred.
A buyer in our sector who is deterred by interest rates rising a bit should not have been entering the market at all. Because Springtree Group’s pool of fully-funded buyers have been well-vetted, they are still eager to invest in lower- and middle-market agencies. We are confident that interest rates would have to climb significantly before STG’s buyers would be impacted.
Sellers, take this opportunity to succeed where other markets are failing. Our market segment is not currently affected, so pursue your independent insurance M&A goals with confidence.
If you are a current client of Springtree Group who has been hesitant to officially announce your readiness to sell, please do not let news reports, interest rates, or escalating inflation hold you back.
Instead, reach out to us directly to receive accurate information regarding your agency’s situation. Rather than predicting the outcome and impact of your sale based on the market at large, we’ll tell you what’s happening with buyers in our precise slice of M&A.
Remember that Springtree Group has an in-house financial department that partners with our buyers to ensure that they are fully funded and prepared to approach a merger or acquisition in the current landscape. Therefore, our buyers have been apprised of the situation and have made the informed decision to pursue M&A at this time.
Once we have analyzed your agency, you may well decide that this is still the perfect time to sell. If so, we will connect you with buyers and assist you with each stage of the sale.
Our buyers are qualified, motivated, and waiting for the chance to invest in a business just like yours. Don’t hesitate; market conditions may still change, and this opportunity may not exist in a mere twenty-four months.
