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Brown & Brown, Inc. acquires the assets of CHAPP, Inc. and Citrus Insurance Services, Inc.

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Rhea-AI Summary
Brown & Brown, Inc. (NYSE: BRO) acquires CHAPP and Citrus Insurance assets, expanding risk management services in Florida and the U.S. The agencies, founded in 1976, offer insurance solutions for agricultural businesses. The acquisition aims to enhance capabilities and provide innovative risk solutions.
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The acquisition of CHAPP and Citrus Insurance by Brown & Brown represents a strategic expansion in the agricultural insurance sector. This move allows Brown & Brown to leverage CHAPP and Citrus Insurance's expertise in agricultural business risk management, a niche yet significant market. By integrating these entities, Brown & Brown can offer enhanced services and potentially increase market share in Florida and across the U.S.

From a market perspective, acquisitions can lead to economies of scale, which could result in cost savings and improved profit margins for Brown & Brown. It also diversifies their portfolio, which is beneficial for risk management and could lead to more stable financial performance, especially in times of economic uncertainty where agriculture might act as a counterbalance to other sectors.

From a financial standpoint, the acquisition's impact on Brown & Brown's earnings will depend on the financial health and profitability of CHAPP and Citrus Insurance. The deal could be accretive, meaning it may increase Brown & Brown's earnings per share if these acquired entities are performing well. Investors should look for changes in Brown & Brown's revenue streams and profit margins in subsequent earnings reports.

Additionally, the acquisition could affect Brown & Brown's cash flows and debt levels. The mode of financing this acquisition, whether through cash reserves or debt, will influence the company's balance sheet. Investors should monitor the company's leverage ratios and interest coverage to assess the financial health post-acquisition.

Acquiring companies with specialized expertise, such as CHAPP and Citrus Insurance, indicates a growing trend in the insurance industry toward niche markets. The agricultural sector presents unique risks, including weather-related events and commodity price fluctuations, which require specialized knowledge to manage effectively.

By incorporating this specialized knowledge, Brown & Brown can enhance its competitive advantage. The move also reflects the broader industry focus on consolidation to strengthen market positions. The long-term success of this acquisition will depend on the seamless integration of the teams and the retention of key personnel who possess critical knowledge of the agricultural insurance market.

DAYTONA BEACH, Fla., April 03, 2024 (GLOBE NEWSWIRE) -- J. Scott Penny, chief acquisitions officer of Brown & Brown, Inc. (NYSE:BRO), and Bucky and Cindy Payne, the owners of CHAPP, Inc. (“CHAPP”) and Citrus Insurance Services, Inc. (“Citrus Insurance”), today announced that Brown & Brown has acquired the assets of CHAPP and Citrus Insurance.

CHAPP and Citrus Insurance are essential risk management partners for their customers in Florida and across the U.S. by providing insurance solutions for all aspects of agricultural business risk. Originally founded by Ed Crawford in 1976, the agencies have continued to grow through two generations of family leadership. The CHAPP/Citrus team will join Brown & Brown’s offices in Lakeland and Sebring, Florida and will work alongside Stacey Heacock, profit center leader of the Lakeland office, and Jason Cloar, executive vice president and leader of Brown & Brown’s southwest Florida operations.

Mike Keeby, senior vice president-Retail segment, stated, “We are very pleased that Bucky, Cindy, Bucky Jr. and Michelle are entrusting the future of the CHAPP and Citrus Insurance agencies to Brown & Brown. The CHAPP/Citrus Insurance teammates are trusted advisors providing innovative risk solutions for the agricultural industry. We are excited to continue to add capabilities in Florida and look forward to our future with this team.”

Bucky Payne Sr. said, “On behalf of my wife, son and daughter, I want to say that we are very pleased to be a part of the Brown & Brown team. This collaboration will allow us to expand our services for our customers utilizing the vast capabilities that Brown & Brown has to offer. We, along with the CHAPP and Citrus Insurance Services teammates, want to thank the Brown & Brown team that made this opportunity possible.”

Brown & Brown, Inc. (NYSE: BRO) is a leading insurance brokerage firm, delivering risk management solutions to individuals and businesses since 1939. With approximately 16,000+ teammates in 500+ locations worldwide, we are committed to providing innovative strategies to help protect what our customers value most. For more information or to find an office near you, please visit bbinsurance.com.

This press release may contain certain statements relating to future results, which are forward-looking statements, including those associated with this acquisition. These statements are not historical facts but instead represent only Brown & Brown’s current belief regarding future events, many of which, by their nature, are inherently uncertain and outside of Brown & Brown’s control. It is possible that Brown & Brown’s actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Further information concerning Brown & Brown and its business, including factors that potentially could materially affect Brown & Brown’s financial results and condition, as well as its other achievements, is contained in Brown & Brown’s filings with the Securities and Exchange Commission. Such factors include those factors relevant to Brown & Brown’s consummation and integration of the announced acquisition, including any matters analyzed in the due diligence process and material adverse changes in the business and financial condition of the seller, the buyer, or both, and their respective customers. All forward-looking statements made herein are made only as of the date of this release, and Brown & Brown does not undertake any obligation to publicly update or correct any forward-looking statements to reflect events or circumstances that subsequently occur or of which Brown & Brown hereafter becomes aware.

For more information:

R. Andrew Watts
Chief financial officer
(386) 239-5770


FAQ

What did Brown & Brown, Inc. (BRO) acquire?

Brown & Brown acquired the assets of CHAPP, Inc. and Citrus Insurance Services, Inc.

What services do CHAPP and Citrus Insurance provide?

CHAPP and Citrus Insurance offer insurance solutions for all aspects of agricultural business risk.

When were CHAPP and Citrus Insurance founded?

CHAPP and Citrus Insurance were originally founded by Ed Crawford in 1976.

How will the CHAPP/Citrus team be integrated into Brown & Brown?

The CHAPP/Citrus team will join Brown & Brown's offices in Lakeland and Sebring, Florida.

What is Brown & Brown, Inc.'s focus as a company?

Brown & Brown, Inc. is a leading insurance brokerage firm, delivering risk management solutions to individuals and businesses since 1939.

Brown & Brown, Inc.

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About BRO

brown & brown is an independent insurance intermediary that, through its licensed subsidiaries, provides a variety of insurance products and services to corporate, public entity, institutional, trade, professional, association and individual clients. becoming a teammate at brown & brown insurance introduces you to a career with virtually unlimited possibilities. our unique corporate culture rewards self-starters and hard workers who adhere to our commitment to do what is best for our clients. with brown & brown you will get the training, the mentoring and the tools you need to succeed. headquartered in daytona beach, we are located all across the united states, with products and services offered through four major business divisions. we are listed on the nyse at bro. our corporate culture is built on vision, speed, agility and strength that allows us to thrive in the very competitive insurance environment. this unique culture has enabled us to quickly chase down new opportunities, adap