Announced and reported mergers and acquisitions for U.S. and Canadian insurance agents and brokers were up 10% during the second quarter of 2017 compared with the same period in 2016, at 135 vs. 122, but showed a decline compared with the first quarter of 2017, which had 185.

Despite the decrease from the first quarter of this year, M&A activity during the second quarter was still the second-most active quarterly period and was eight transactions more than the second quarter of 2015, the next highest period at 127 deals. The streak of 100-plus transactions per quarter now extends to 11 quarters in a row, with only one quarterly period prior to this streak with more than 100 deals announced, and that was from the end of 2012 before the capital gains tax rate increased.

On a rolling 12-month basis, the total number of announced transactions reached 539, up from 456 for all of 2016, an 18% increase, while the six-month total was 320 transactions compared with 237 last year.

Through six months, Caledonia, Michiganbased Acrisure L.L.C. reported the most activity with 48 closed transactions, up from 28 last year. Alera Group, the newly formed private equity-backed firm based in Deerfield, Illinois, was second with 27 completed transactions, including 24 effective Jan. 1. Chicago-based Hub International Ltd. was third, completing 21 transactions, followed by Columbus, Ohio-based Broadstreet Partners Inc. and Chicago-based Arthur J. Gallagher & Co., both with 18 announced transactions.

NFP Corp. was the only other buyer with double-digit transactions in 2017, finishing the first half with 10 announced deals, up from two during the first half of 2016.

Acrisure and Alera reported the biggest increases in the number of deals compared with the first six months of 2016, up by 20 and 27 deals respectively, recognizing that Alera was new in 2017. Also increasing by five or more transactions in 2017 were NFP, to 10 from two; Broadstreet, to 18 from 12; and Saskatoon, Saskatchewanbased newcomer Palliser Insurance Co. Ltd., to five from zero. There was only one firm experiencing a decrease of five or more transactions, with Lake Mary, Floridabased AssuredPartners Inc. down to 12 announced acquisitions from 17.

Private equity-backed buyers as a group accounted for 173, or 54%, of 2017’s reported transactions compared with 116, or 49%, in 2016’s first half, spread across 19 different buyers; this was somewhat distorted by the 24 Alera transactions.

Privately owned brokerage acquisitions increased to 90 transactions and 66 unique buyers in 2017, up from 71 acquisitions from 58 separate buyers in the first half of 2016. This represents the highest sixmonth total of both the number of transactions and the number of unique buyers from the privately owned buyer group.

Of the 90 private transactions in 2017, 11 firms completed multiple transactions totaling 35 deals, while the remaining 55 transactions were completed by 55 other firms. For the private equity-backed group, five deals came from firms with only one transaction, while the other 168 transactions were executed by 14 other buyers.

Eight of the top 10 buyers in 2017 were private equity-backed firms, with Gallagher and OneDigital as the two other firms in the top 10, although Atlanta-based OneDigital Health and Benefits will no longer be classified as privately owned after it was sold by Fidelity National Financial Inc. to private equity-backed New Mountain Capital in June. This concentration of private equitybacked buyers in the top 10 list has been growing since we began tracking in 2008, when only four of the top 10 — Hub, USI Insurance Services L.L.C., Broadstreet Partners Inc. and Ascension Insurance Inc. — had private equity backing.

Property/casualty brokers continued to dominate the sell-side M&A landscape, with 156 of the 2017 transactions, followed by employee benefits brokers at 89.

Agencies selling both property/casualty and employee benefits coverages saw 54 deals thus far in 2017, with 21 “other” transactions made up of managing general agents, third-party administrators and other seller formats. Aside from the “other” category, each of the seller segments registered their highest number of deals for any six-month period.

There were 23 firms reporting five or more transactions in the 12-month period ending June 30, up from 16 in 2016 and 17 in 2015, but the top 10 buyers in each of the past three years accounted for 53% of the total number of transactions. In 2008, the top 10 buyers only accounted for 42% of the total number of transactions, illustrating the increased concentration of buyer activity over the past 10 years In the second quarter of 2017, there were several significant transactions:

• Partners Specialty Group L.L.C., the ninth-largest wholesale firm, sold to AmWINS Group Inc. in April.

• Aon P.L.C. sold its human resources consulting division, Aon Hewitt, to Blackstone Group L.P. in May.

• Wells Fargo & Co. announced the sale of its commercial insurance business, Wells Fargo Insurance Services USA Inc., to USI in June.

• Fidelity National Financial sold its interest in OneDigital to New Mountain Capital in June.

There also were several large notable transactions that were announced or closed during the first quarter of 2017:

• Marsh & McLennan Agency acquired J. Smith Lanier & Co. (No. 30 on the Business Insurance ranking in 2016) in January.

• Keenan & Associates (No. 22 in 2016) was acquired by AssuredPartners in March.

• Capacity Group of Cos. (No. 39 in 2016) sold to EPIC in March.

• USI’s private equity partner, Onex Corp., announced it would be selling its stake in USI to KKR & Co. L.P. and a Canadian pension fund in a transaction valued at over $4 billion in March.

• NFP received a capital infusion of $750 million from HPS Investment Partners to join Madison Dearborn Partners as the private equity sponsor.

Timothy J. Cunningham and Daniel P. Menzer are principals at Optis Partners L.L.C., a Chicago-based investment banking and financial consulting firm that serves the insurance distribution sector. Mr. Cunningham can be reached at 312-235-0081 or cunningham@optisins.com; Mr. Menzer can be reached at 630-520-0490 or menzer@optisins.com.