The Hartford Chairman and CEO Christopher Swift said he remains interested in potential acquisitions – even large ones – less than a year after completing a noteworthy M&A deal in mid-2016.
However, plenty of conditions and criteria must be met before executives will pull the acquisition trigger again, Swift explained during The Hartford’s 2017 first quarter investor call.
“We’ve been proactive in the marketplace [and] we’re very disciplined in our approach. It has to make strategic and financial sense,” Swift said in response to a question on what size of M&A deal The Hartford might pursue.
Last July, The Hartford completed its $168 million acquisition of Maxum Specialty Insurance Group for $168 million in cash, gaining a property that wrote $157 million in premium in 2015, versus The Hartford’s far larger commercial unit, which handles about $6.7 billion annually, according to 2016 figures. The insurer kept Maxum Specialty’s branded and limited wholesale distribution model as a separate unit within its Small Commercial business.
Swift said a future acquisition [a bolt on or extension into an adjacent market] should be relatively easy to integrate. He added, however, that the insurer is also “open to larger opportunities that accelerate our growth in markets, product lines, and geographies that we want to be in.”
For a larger company, Swift said The Hartford would seek an acquisition target with between $500 million and $1 billion of premium.
“That would be something digestible,” Swift said during the call. “But again, it has to make financial sense, and we’ve been disciplined, given we’ve been at this over the last four years, and we’ve said no to a lot of opportunities.”