NU Online News Service, Feb. 3, 12:43 p.m. EST
Winston-Salem, N.C.-based bank BB&T Corp. has acquired Roseland, N.J.-based wholesale-insurance broker Crump Group Inc.
BB&T says it will acquire Crump Property and Casualty Insurance Services and Crump Life Insurance Services for $570 million in cash from the private-equity firm J.C. Flowers & Co.
BB&T says the deal is expected to add approximately $300 million in annual revenue to BB&T Insurance.
The transaction, which is still subject to regulatory approval, is expected to close during the first quarter of this year. BB&T does not acquire Crump’s retirement services business, Ascensus, but does acquire the rights to the Crump name.
BB&T, which owns one of the top-10 insurance-brokerage firms in theUnited States, will become the largest wholesale broker in the country. The firm owns the wholesale P&C brokerage firm CRC Insurance Services, managing general agent Southern Cross TAPCE Underwriters and managing general underwriter AmRisc LLP.
While BB&T already has a substantial P&C wholesale business, the acquisition will expand its role on the life side, increasing its revenue stream for life products from 1 percent to 13 percent.
“As the largest independent wholesale life-insurance distributor in the country, the Crump acquisition significantly expands and strengthens our insurance operations,” says Kelly S. King, BB&T’s chairman and chief executive officer in a statement. “The deal is a great strategic fit for BB&T, immediately increasing and diversifying our fee income while driving stronger revenues.”
“We’ve known and respected Crump for years and consider them an industry,” says Wade Reece, BB&T Insurance chairman and CEO. “This is an opportunity for BB&T to become a significant and strategic player in the high-growth, high-margin life insurance distribution business and expand our property and casualty business.”
BB&T says John Howard, president and CEO of Crump Group will join BB&T in a senior leadership role reporting to Reece.
In a separate statement, Howard says the transaction “will be a positive development for our insurance clients and carriers, who will have access to greater resources and capabilities, as well as our employees, who will become part of one of the largest global providers of insurance services.”
Dave Obenauer, president of Crump P&C, will be in charge of the P&C integration with BB&T. Brian Winikoff, president of Crump Life, will continue as president of the life division. Both will report to Howard, Crump says.
J.C. Flowers acquired Crump in 2005 from Marsh when it was then a P&C wholesale-brokerage firm. Flowers went on to acquire BISYS, which is concentrated in wholesale-life products in 2007, and combined the two operations.