AGA Benefit Solutions (AGA) has acquired Aptus Benefits, a British Columbia firm that specializes in collectively bargained plans and executive disability programs.
Based in Vancouver, the firm offers group benefits and retirement plans. Among its services, Aptus Benefits develops customized plans and redesigns and manages complex plans.
AGA completed the transaction in partnership with Novacap, a minority shareholder of AGA. A consolidator on the acquisition path, AGA notably acquired PPI Benefits in October 2021.
Western Expansion
AGA says the acquisition of Aptus is part of its expansion into Western Canada. "We look forward to welcoming Bill Watt and the team to the AGA family and to bring our suite of solutions to clients in Western Canada," stated Martin Papillon, president and CEO of AGA. "We are putting all of AGA's capabilities at the service of the team in Vancouver, enabling them to deliver a full range of services to their valued clients."
"This is an exciting opportunity for Aptus Benefits, as we work to elevate our position in retirement and group benefits services in Western Canada," added Bill Watt, principal at Aptus Benefits.
In an interview with the Insurance Portal, Papillon said the six-person Aptus team now operates under the AGA banner, which now covers Canada from coast to coast. "With this acquisition, we will have employees in Vancouver. We already had people in Edmonton, Calgary, Kitchener, Toronto, Montreal, Quebec and St. John, New Brunswick," said Papillon. "We now have a solid presence in Vancouver and big ambitions for Western Canada."
"AGA approached Aptus," he added. "Every month, we look at one to two acquisition targets. We are working on some of these potential acquisitions. We've dropped others when our values did not align. With Bill, the alignment is excellent," he said.
Small firm, large scale
During the interview, Martin Papillon referred to Aptus Benefits as a small firm with a large scope. Aptus Benefits specializes in employee benefit trusts. "It's a concept that's not very common in Quebec, but much more common in English Canada, with unionized groups," he explained.
This is AGA's second acquisition in this sector. The first was made in January with the acquisition of J&D Benefits, a customized benefits administration service provider based in Markham, Ontario.
In this type of structure, employers in a sector will contribute to the trust and union members will receive benefits paid for by the trust, Papillon said. Some of Bill Watt's clients have 10,000 policyholders.
Papillon said that firms specialized in healthcare trusts are not used to calculating their premium volume. He estimates Aptus' volume to be worth about $100 million ($M). "I have one client in mind that represents $40 million in premiums alone," he said.
Papillon said Aptus is an advisor to large corporations. He added that 60% of the firm's revenue comes from its group insurance business and 40% from its retirement plan business. In addition to the health trust niche, Aptus also has corporate clients, said Papillon.
