Hub International announced Friday that its Massachusetts subsidiary, Hub International New England L.L.C., has acquired the assets of E. J. Wells Insurance Agency Inc. of Westford, Massachusetts.
A specialized construction industry agency
The Wells Agency, founded in 1900, specialized in providing specialty insurance, risk management and consulting services to the construction industry. The Wells Agency’s principal, Paul J. Coffey served as president of the Massachusetts Building Congress in 2009. The agency also was involved with the Associated Sub-Contractors of Massachusetts and AGC Massachusetts, the Association of Commercial and Institutional Builders.
In addition, the agency was noted for developing a private client group who were offered specialized services for safety and asset control through cost effective insurance and risk management programs and services including, but not limited to, review of workers compensation experience rating modification, loss control and risk transfer strategies, claims management procedures, and reviewing all contracts to offer advice on insurance provisions.
At the time of the sale, this private client group included 17 well-known construction-related companies, including General Contractors: Aberthaw Construction Co., Inc.; Berkeley Building Co.; Bond Brothers, Inc.; J. M. Coull, Inc.; L.D. Russo, Inc.; Nauset Construction Corporation; Vareika Construction Co., Inc. Utility Contractors: New England Utility Constructors, Inc.; Midway Utility Contractors, LLC; Roofing Reliable Roofing & Sheet Metal, LLC. Dry Wall Contractors: Tenant Systems, Inc. Elevator Contractors: Bay State Elevator Company; Stanley Elevator Co., Inc. Mechanical Contractors: Ultra Services, Inc., as well as Waterproofing: Architectural Building & Restoration, LLC. Steel Erection: Saugus Construction Corporation, and Paving: A. F. Amorello & Son.
Hub International’s amazing growth since 1998
Originally founded in 1998 through the merger of 11 Canadian insurance brokerages, Hub International Limited has since then moved its headquarters from Canada to the United States, gone public, gone private and been sold. It has also successfully expanded through over 250 acquisitions to become the world’s 10th largest insurance brokerage firm.
The Wells Agency will work out of Hub New England’s Acton office
Hub New England has almost 400 employees working in 18 locations in Massachusetts, New Hampshire and Rhode Island. According to a Boston Business Journal June 2013 ranking of Massachusetts insurance brokers, Hub New England in Massachusetts produces over $740 million in premium and is the third largest broker behind USI Insurance and the Bostonian Group (part of Marsh & McLennan since 2010).
The E.J. Wells operations will become part of Hub New England’s existing office in Acton, Massachusetts. In connection with the acquisition, Paul J. Coffey, President, E.J. Wells, will join Hub New England as Executive Vice President, he will report to Charles J. Brophy, CEO, Hub New England. Mr. Brophy was quoted in the press release as stating:
“We are very excited to have Paul and the E.J. Wells team join Hub New England,”… “His talents and expertise in the construction vertical are a welcomed addition to our organization.”
Hub International’s own interesting sale history
A publicly traded firm since 1999 in Canada, Hub International had a United States initial public offering (IPO) in 2002 at $14 per share to raise a little over $84 million to finance its acquisition strategy. By 2006, its success allowed it to raise an additional $114.9 million in a secondary offering where it offered the new shares at $26.25 each.
In 2007, Apax Partners, a private-equity firm, and Morgan Stanley’s principal investment group purchased the public stock of Hub International at $41.50 a share or at a 33% premium over market price to take the company private. The total deal cost these investors approximately $1.9 billion.
In October 2013, Hellman & Friedman bought out the 2007 purchasers for just over $4.4 billion. As a result of the sale, investment funds managed by Hellman & Friedman hold a majority interest in the company, but members of Hub International’s senior management do continue to have significant equity positions.
Whoever may own it now, there is no question that Hub International will keep to its successful roll-up strategy here at home if Hub International’s Chief Executive Martin Hughes can be taken at his word. The insurance-brokerage business “is highly fragmented, despite the fact we have been highly acquisitive” in recent years, he said at the time the Hellman & Friedman deal was announced. “The opportunity is enormous” to make more deals.
