Hub International Limited (NYSE:HBG) and (TSX:HBG) today announced the acquisition of Garnet Health Systems Corporation and Garnet Insurance Services, LLC (Garnet), both of Hampton, New Hampshire, for an undisclosed amount of cash and Hub stock. The firms, with combined annual revenue of approximately $3 million, will remain in Hampton and become part of the Company's New England hub, C.J. McCarthy Insurance Agency, Inc. (McCarthy). Garnet's principals, Donald V. Earle, President, and Michael R. Jeresaty, Executive Vice President, will report to Richard J. Palleschi, McCarthy President.
Garnet's health systems group provides credentialing services enabling physicians to outsource to Garnet the completion of forms required by carriers. It is a fee-based business that currently has a customer base of approximately 9,000 physicians at various hospitals, HMOs and other provider groups. Garnet's insurance services operation earns commissions by arranging medical malpractice insurance for doctors. Garnet's clients are primarily in New England, Metropolitan New York City, California, Illinois and Michigan.
Mr. Earle is a graduate of Bates College in Lewiston, Maine and earned an MBA at Boston University. He holds a faculty appointment in the College of Medicine at the University of Vermont in Burlington. Prior to co-founding Garnet with Mr. Jeresaty, Mr. Earle served as an information systems executive with several healthcare organizations. Mr. Jeresaty, also a Bates College graduate, obtained his MBA from the University of Texas in Austin. He was previously a senior marketing manager at U.S. Healthcare in Boston and also held marketing positions at various large pharmaceutical firms.
McCarthy is one of 11 regional "hubs" that make up Hub International Limited, one of the largest insurance brokerages in North America. Hub International's growth strategy includes the acquisition of large, entrepreneurial brokerages that service primarily middle market clients, and the expansion of these regional hubs through fold-in acquisitions of smaller, local firms. Since January 1, 2003 Hub has made ten fold-in acquisitions, including the Garnet Companies.
"Garnet's capabilities enable us to expand our New England business with a fee-based service that offers valuable administrative support to the medical community as well as an excellent book of professional liability insurance," said Martin P. Hughes, Hub Chairman and Chief Executive Officer. "By affiliating with Hub, Garnet has access to our entire national production force which will help them grow their specialty business. We've also deepened our talent pool with the addition of Don Earle and Michael Jeresaty."
Hub International has established strong access to insurance markets in the United States and Canada, enabling its customers to benefit from both expanded access and coverage choices through the Hub network. As new brokerages are added to the organization, clients of these brokerages gain the same access and resources that have helped Hub International become a leading competitor in its markets.
Headquartered in Chicago, IL, Hub International is a leading North American insurance brokerage that provides a broad array of property and casualty, 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 which 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 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. 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.