Insurance Agency Services
Merger and Acquisition Advisors
Sukay & Associates Services Offering
We treat each transaction as if the company were our own. We will handle each transaction knowing that this is most likely a one-time event for our client. Sometimes the best transaction is the one that doesn’t happen, we will never recommend a transaction that we do not believe will achieve fair value for our client.
Insurance Agency Valuations
Valuation services are a normal part of an Internal Perpetuation Plan. Valuation Plans can be performed on a recurring basis or as a result of a perpetuation event. Insurance Agency Valuations can also be performed to determine if a sales transaction will achieve the seller’s financial goals.
Although there is no one simple formula to value an agency, we welcome an initial conversation to outline the 9 indicators of value, which may be of use to you.
Agencies reach the conclusion to sell either as the result of an active or reactive process. An active process occurs when an Internal Perpetuation is not achievable. Reactive processes occur when an agency receives an overture from a third party buyer. Many agencies receive inquiries regarding whether or not they are intending to sell. Sukay & Associates, Inc. is committed to determining whether a sale will achieve the goals of the owner. We evaluate the timing of a transaction. We provide market insight and perform a thorough analysis of each company which helps answer questions such as:
Should the company improve its operations and then sell after it is able to demonstrate its improved profitability?
Is it the best time for the agency owner to maximize value?
In the event that a seller decides it is the right time to pursue a sale, the key is to find the right buyer. If the intent of a seller is to become part of a buyer’s organization, we can seek an appropriate “match” for the seller and assess how well the two cultures blend together. If a seller’s goal is to maximize their return, we will construct a sales process geared toward achieving the highest transaction value.
Many advisors will describe how each agency and each deal is unique. If that is correct, why is it that so many deals are structured in the same manner for very similar multiples? Sukay & Associates will pursue a transaction from many perspectives and match the strengths of a seller to the needs of a buyer. We handle each deal as if we were selling our own single largest asset.
We will never recommend a transaction that does not achieve fair value for our clients, as well as a good cultural fit. We have seen too many other advisors recommend deals that fall apart in the long run because the emphasis was on the short run — getting the deal done versus creating a strategic union.
The vast majority of the inquiries that we receive relate to questions about an Internal Perpetuation. Regardless of the nature of the inquiry, we always begin with an assessment of our client’s goals. Perpetuation engagements are complex. Even when the client has clear intent and goal to Internally Perpetuate, numerous issues will need to be addressed. We assist the client with all of these issues including valuation and funding.
We also have been very active in reviewing existing Perpetuation Plans. The best of these Plans seem to have major flaws. We have found that the larger the agency, the greater likelihood that the Plan will need to be addressed.
One of the most difficult decisions our clients face is the hiring of legal counsel. Every agency has a corporate counsel. Many of these attorneys have represented the agency for decades, but many are not experienced in mergers and acquisitions transactions in the insurance brokerage industry and lack experience in dealing with the multitude of agency buyers. If you are undertaking the most important event in your professional career by selling your agency, you do not want to accomplish this task while training your legal counsel.
We recognize this problem. We have spent many years working with lawyers throughout the country. For our last four transactions, our clients have selected Richard G. Satin, Esq., a partner in Schnader Harrison Segal & Lewis LLP. Our experience with Richard has reinforced our belief that the selection of legal counsel can be an important factor in whether the deal closes in an efficient and timely manner. While a client of Sukay & Associates has no obligation to select Richard Satin as their legal counsel, we feel very strongly about the team concept. Having now worked closely with Richard on four transactions, we have now developed a team that can guide you through all phases of the sales process, from the initial financial analysis and marketing to the closing of the transaction.
We have found Richard to be an able and efficient lawyer who has proved his effectiveness with the most active agency buyers. We couldn’t be more pleased about our relationship with Schnader Harrison Segal & Lewis LLP and with Richard Satin.