HUB To Acquire Transportation Specialist Coburn Insurance
Hub International Limited (NYSE:HBG) (TSX:HBG) plans to accelerate its penetration of the transportation insurance market by acquiring Vermont-based Coburn Insurance Agency, Inc. ("Coburn"). The $9 million revenue broker has entered into a letter of intent with Hub International Transportation Insurance Services Inc. (HUB Transportation). The proposed transaction will result in the formation of one of the nation's largest transportation insurance speciality practices, with an emphasis on trucking.
HUB International recently expanded its transportation practice in October with the acquisition of Kaufman and Kaufman, a $9 million revenue brokerage based in Salt Lake City. With the acquisition of Coburn, HUB's transportation practice will have annualized revenue of approximately $25 million from more than $200 million in premiums, with strong operations in both the eastern and western United States. The combined strength of the operations will provide HUB with increased accessibility to insurance markets and will position the organization as the provider of choice for transportation risks across the US and Canada.
"We are making a substantial commitment to growth in the transportation brokerage sector, which is a profitable and underserved segment of the insurance market," said Martin P. Hughes, chairman and chief executive officer of Hub International Limited. "Specialty practices are an increasingly important component of our growth strategy, as evidenced by several of our recent acquisitions."
Coburn has offices in Burlington (Colchester) Vermont; Hilton Head, South Carolina; Memphis, Tennessee; and Deland and New Smyrna Beach, Florida. Scott Light, Coburn's president, will become president of HUB Transportation, reporting to Dale Kaufman, chief executive officer.
"Our partners at Coburn recognize the growth prospects presented by HUB and we are ready to capitalize on all opportunities presented to us," Light said. "Trucking companies require specialized insurance expertise and we are confident that our national strategy will provide increased benefits for our transportation customer and insurance company partners. We look forward to expanding our customer base as a part of the HUB organization."
Completion of the Coburn acquisition is subject to the execution of a definitive purchase agreement and other customary closing conditions. Closing on the transaction is expected during the first quarter of 2007.
Headquartered in Chicago, IL, Hub International Limited is a leading North American insurance brokerage that provides a broad array of property and casualty, reinsurance, life and health, employee benefits, investment and risk management products and services through offices located in the United States and Canada.
This press release may contain forward-looking statements that reflect our current views with respect to future events and financial performance. These forward-looking statements relate, among other things, to our plans and objectives for future operations and are subject to uncertainties and other factors that could cause actual results to differ materially from such statements. These uncertainties and other factors include, but are not limited to, risks associated with implementing our business strategies, identifying and consummating acquisitions, integrating acquired brokerages, attaining greater market share, developing and implementing effective information technology systems, recruiting and retaining qualified employees, fluctuations in the premiums charged by insurance companies with corresponding fluctuations in our premium-based revenue, any loss of services of key executives, industry consolidation, increased competition in the industry, fluctuations in the demand for insurance products, exchange rates, resolution of regulatory issues, including those related to compensation arrangements with insurance companies, the actual costs of resolution of contingent liabilities and the passage of new legislation subjecting our business to regulation in jurisdictions where we operate. We caution readers not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Additional information regarding these risks and other factors that could cause Hub International's actual results to differ materially from our expectations is contained in the company's filings with the Securities and Exchange Commission and the Canadian securities commissions. Except as otherwise required by federal securities laws, Hub International undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.