Arachas Corporate Brokers, an insurance broker group chaired by former minister for finance Charlie McCreevy, paid €25 million in dividends to its parent last year as revenue and earnings continued to grow.
The latest payout brings total distributions to its immediate parent since it was purchased by the UK-based Ardonagh Group five years ago to €141.4 million. It equates to about 56 per cent of its reported €250 million purchase price. Dividends are ultimately fed back to the parent entity.
Still, Ardonagh has backed Arachas as the Irish continued to play a leading role in deal-making across the sector.
Arachas’s turnover rose almost 13 per cent last year to €128 million, while operating profit advanced 11.4 per cent to €47 million, driven by acquisitions and organic growth, the company said in its latest financial statement.
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Companies absorbed by Arachas last year include Sheeran Insurances in Dublin, Limerick-based Gerry O’Mahony Insurances and Frost Insurances, Tom Fogarty Insurance Brokers in Tipperary, as well as Gilmartin Insurances in Leitrim. Each was acquired for an undisclosed sum.
Arachas wrote about €600 million of business on behalf of customers in 2024, giving it a 13 per cent market share of activity in the market.
“The results reflect another year of organic growth in our core business, driven by a strong performance in our speciality schemes portfolio which has brought more product choice and, importantly, capacity to the market. This has been supported by the integration of four additional acquisitions during the year, and we progress our regional expansion,” said Arachas chief financial officer Martin Mohan.
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“The outlook for the business is robust, and we have grown to over 750 employees across 14 offices around the country, including the opening of new offices in Tipperary, Limerick and Sligo this year.”
Arachas, which earns about 85 per cent of its revenues from commercial insurance and the remainder from personal lines, has been at the forefront of a wave of consolidation among Irish insurance brokers in the past decade.
Many of the acquirers, including Arachas, are ultimately backed by private equity firms, which are attracted to relatively predictable revenues from commission income.
Owners of brokers, on the other hand, have been tempted by the strong valuations being achieved in the industry, amid issues over succession planning and the need for investment in many businesses in an era of growing compliance and regulatory demands.
Arachas took ownership of Waterford-based broker McDonald Dwyer Reddy & Byrne Insurances in March of this year, three months after its immediate parent, Arachas Bidco, acquired the business for an undisclosed figure. Other Arachas Bidco deals transferred to the company this year include Cavan-based John Brady Insurances Limited, Kinane Insurances in Dublin and Cork-based Insight Insurance Brokers.
Arachas was acquired in 2020 by Ardonagh, a UK brokerage group led by Irish man David Ross, for €250 million in a debt-backed deal. Ardonagh was valued at $14 billion (€12.1 billion) last year under a deal in which US private equity firm Stone Point Capital took a stake in the business.
