Synex Business Performance has made a new acquisition, in the Centre-du-Québec region. Drummondville-based Verrier & Associés Inc., founded in 1939, has joined the Synex group.
The transaction was announced in a press release issued July 7.
The brokerage, whose premium volume tops $60 million, also operates offices in Quebec City, Trois-Rivières, Sherbrooke and Victoriaville. The firm’s website says Verrier has about 49 brokers on staff.
According to Insurance Portal’s most recent P&C firm analysis, Verrier reported $53 million in P&C volume as of December 31, 2021. Yan Charbonneau, president of Synex Business Performance, says the figure was already higher at the time the transaction closed. The firm has experienced strong organic growth since the beginning of the year, in addition to premium increases that occur with contract renewals.
This transaction allows Synex to increase its presence in the Centre-du-Québec, Mauricie and Eastern Townships regions. Éric Verrier, partner, president and CEO of the company, will continue to act as managing director of the firm, and other Verrier shareholders are remaining partners in the firm.
Verrier & Associates is a major player in P&C insurance for the industrial and commercial sectors, including risk management, employee benefits, and life insurance and financial services consultants.
Second handover in five years
The transaction was completed on July 7 and the changes have already been submitted to the Quebec Enterprise Register. In 2017, Verrier’s management team bought out the shares of the former owner, Michel Verrier.
This MBO (management buyout) allowed Michel Verrier’s nephew Éric to acquire the firm with three other colleagues: Éric Desrosiers, Sylvain Turgeon and Marian Jacobs. The insurer Northbridge also participated in the financing of the transaction by purchasing 20 per cent of the shares.
Yan Charbonneau confirms that the insurer’s holding in Verrier has been bought out, as well as the vast majority of the shares of the four shareholders.
“Big firms are getting bigger and bigger. There has been a lot of consolidation since 2017,” Charbonneau says.
Even with $50 million in business volume, for example, it is challenging to connect with P&C insurers. “Verrier was looking for a partner to continue to grow, to gain access to markets and new expertise,” Charbonneau points out.
Independent brokerage
Éric Verrier echoes Yan Charbonneau’s views. He says the transaction was driven by the market evolution and the continuing consolidation, both among insurers and in the brokerage industry.
“When we bought the company shares five years ago, we were all already in our 50s. Now we’re approaching our late 50s,” Verrier says. The four partners are continuing to work at the firm in the same roles as before, he adds.
Verrier says he has crossed paths with Yan Charbonneau at public events in recent years and shares his vision for the future of independent brokerage. “He believes in giving firm leaders and local entrepreneurs freedom,” Verrier explains.
When the managers decided to put the firm up for sale, Verrier contacted Charbonneau to see if the marriage was still a possibility. “Charbonneau has strong partners, he’s making good investments and he’s building strategic partnerships that are complementary to what’s already in his group, so it creates some synergy,” Verrier continues.
There were discussions with other potential buyers, but Synex’s vision of an independent brokerage was retained, Éric Verrier adds.
“We are all entrepreneurs, and the opportunity to remain entrepreneurs in our firm, with latitude and room to maneuver, while being supported by better management tools and more specialists, was attractive to us,” adds Verrier.
He also notes that other members of the Verrier team will be able to acquire a stake in the brokerage. Announcements are expected in the coming weeks.
Complementary expertise
At the time of the 2017 transaction in, management wanted to make Verrier a one-stop shop for contractors. “Their firm is very similar to the type of ‘business’ we have in Quebec City with the firm Couture Rochette,” Yan Charbonneau told Insurance Portal.
“What’s more, the firm offers Synex exceptional geographic positioning: it opens up new territory for us,” he says.
Verrier also contributes additional commercial insurance expertise, particularly in the construction sector. “This type of transaction is very worthwhile,” Charbonneau says, because the large Quebec and Canadian consolidators have only a modest presence in the Centre-du-Québec region.
Expansion in 2022
FAGA Solutions assisted with the transaction, firm partner Jonathan Palmaerts explains. The Verrier team approached the facilitator.
As a result of this acquisition, Synex Business Performance now has a volume of $770 million under the Synex Insurance and Synex Group Solutions brands. About 20 brokerage firms are part of the group.
Synex’s most recent transaction took place in the employee benefits sector. The acquisition of Quebec-City based Avantages Sociaux Intégrés (ASI) in May followed closely on the heels of the acquisition of ZLC Employee Benefits Solutions in British Columbia one month earlier.
Three other P&C insurance transactions were announced in March. The acquisition of Palladium Insurance gave Synex a foothold in Ontario.
This transaction followed shortly after the buyout of André Fradet Assurances, in the Quebec City area.
In early March, the subsidiary GoToInsure, which serves Atlantic Canada, acquired Hope Grant, headquartered in New Brunswick.
Synex aims to become the largest independent brokerage player in Canada. Its mission is to save the independent brokerage industry by putting the insurance business back in the hands of entrepreneurs.
