By Scott Vincent

Jan 31 - (The Insurer) - Arthur J Gallagher has around $3.5bn of funding available to support M&A in 2025, management revealed during the group’s fourth-quarter earnings call.

During the quarter, the broker said it completed 20 new tuck-in mergers that represented around $200mn of estimated annualised revenue, bringing the full-year total to $387mn.

This was separate to the $13.5bn AssuredPartners acquisition, which is expected to add $2.9bn of annual pro forma revenue.

“It's a compelling opportunity to build upon our commercial middle-market focus, deepen our niche practice groups and further leverage our data and analytics, allowing us to provide even more value to clients,” chairman and CEO Pat Gallagher told the earnings call.

Gallagher said the deal should also expand the broker’s tuck-in M&A reach and create more retail and specialty revenue opportunities across the group.

He said the AssuredPartners deal was on course to close at some point during the first quarter.

“Although we will continue to operate as two independent companies until close, we have started discussions and are very impressed with the talent, professionalism and excitement of the Assured colleagues,” he said,

“In addition to the pending AssuredPartners acquisition, we have about 45 term sheets signed or being prepared, representing around $650 million of annualized revenue.”

CFO Douglas Howell said available cash at hand to fund M&A stood at more than $14bn as of 31 December, of which approximately $13.5bn will be used to fund the AssuredPartners deal.

“Since year-end, we received another $1.3 billion as the underwriters exercised the green shoe. So considering this and our strong expected free cash flow, we are in an excellent position to fund our M&A pipeline of opportunities.”

In addition to the $3.5bn available to fund M&A in 2025, Howell said the group expects to have close to $5bn available in 2026.