BOSTON — Berkshire Hills Bancorp, Inc. (NYSE: BHLB) and Brown & Brown, Inc. (NYSE: BRO) today announced the execution of a definitive agreement for the sale of the assets and operations of Berkshire Insurance Group, Inc. (BIG), a subsidiary of Berkshire Hills, to Brown & Brown of Massachusetts, LLC, a subsidiary of Brown & Brown. The transaction is subject to customary conditions and is expected to be completed in the third quarter.
BIG has been providing insurance coverage to customers across the Northeast since its inception in 2000, growing into one of the largest insurance agencies in Western Massachusetts. They provide personal and commercial property and casualty insurance solutions.
“Consistent with Berkshire’s Exciting Strategic Transformation (BEST) program, this transaction allows us to simplify our operating model, repurpose valuable resources and redeploy capital to support core businesses and strategic initiatives that will enhance long term stakeholder value,” stated Berkshire CEO, Nitin J. Mhatre. “As a result of this transaction, we will record a net gain on sale of approximately $0.55 per share on a GAAP basis in the third quarter, and anticipate $0.02 lower earnings per share in the second half of 2021.”
Sean Gray, President & COO of Berkshire Bank added, “Berkshire has entered into an exciting partnership with Brown & Brown through which we will be able to serve our customers better with an expanded offering of insurance solutions. I also want to thank the dedicated team of employees at BIG, whom I’ve had the privilege of working alongside for the past ten years, for their contributions to Berkshire and all our communities. I know they will continue to serve Berkshire customers well in their new roles with Brown & Brown.”
Brown & Brown has offered positions to existing BIG employees resulting in no job eliminations. Following the acquisition, BIG will become a new stand-alone operation within Brown & Brown’s Retail Segment under the leadership of John Flaherty. BIG’s offices in Greenfield, Longmeadow, Pittsfield, Stockbridge, and Westfield, Massachusetts will continue to operate from their current locations, and its other locations will physically combine with existing Brown & Brown offices. In addition, through a partner relationship, Berkshire Bank will continue to refer customers to Brown & Brown. Don McGowan, a Regional President in Brown & Brown’s Retail Segment with responsibility for various offices in Massachusetts and the Northeast, will oversee the new, combined operations.
McGowan stated, “This transaction allows us to further expand our footprint in Massachusetts with several new strategic locations that we believe enable us to better serve our customers. We are excited to welcome all of the talented BIG teammates to the Brown & Brown organization and look forward to finding fresh opportunities to offer a wide range of insurance products and services to new and existing customers.”
RBC Capital Markets is acting as financial advisor to Berkshire and Luse Gorman, PC is acting as legal advisor to Berkshire on this transaction.
Source: Brown & Brown, Inc.
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