By James Thaler

March 20 - (The Insurer) - Arthur J Gallagher-owned Risk Placement Services (RPS) is close to a deal to acquire long-established El Paso, Texas-based independent wholesaler Litchfield Special Risks as the segment continues to consolidate.

Details on Litchfield’s revenue or premium figures could not immediately be confirmed, but multiple senior wholesale sources with knowledge of the four-decades-old firm suggested that it is relatively small in size, and handles somewhere in the region of $40 million in premium.

Based on typical industry margins, commissions and recent valuation multiples for specialty distribution deals, RPS’ acquisition of the company could be worth somewhere in the region of $50 million.

The deal between RPS and Litchfield could be announced as soon as early next week, said a senior broker source familiar with the situation.

Litchfield was founded in 1980 and is led by president Bobby Maes, with offices in multiple states.

Among the states where Litchfield places business are Arkansas, Arizona, California, Colorado, Florida, Iowa, Illinois, Kansas, Missouri, Nebraska, Nevada, New Mexico, Oklahoma, Tennessee, Texas, Utah and Wyoming.

The company touts its mobile underwriting as its “unique and exclusive service”, and promotes itself as implementing online quoting and quickly quoting submissions, which it says is aimed at helping retailers “move more business off of (their) desks” more quickly than other wholesalers.

Gallagher has continued to be an aggressive acquirer in recent years, largely with a strategy of buying retail agencies, as it completed 25 deals in 2023 and 48 in 2024.

The Insurer broke the news late last month that Gallagher was closing in on a deal to acquire D&O specialist retail broker Woodruff Sawyer, which the firms later confirmed earlier this month as a $1.2 billion transaction.

The Insurer also first reported in December that Gallagher would be acquiring AssuredPartners in a $13.5 billion deal.

Gallagher recently disclosed that the expected closing date for the AssuredPartners transaction is now expected to occur in the second half of this year, as the combination goes through the antitrust regulatory process.

RPS was launched as Gallagher’s wholesale arm in 1997 and was led until the beginning of last year by Joel Cavaness, who transitioned to the post of chairman, with Kevin Doyle promoted to become CEO.

Since its founding RPS has grown to be among the largest wholesale brokers, managing general agents and program administrators, and the largest Lloyd’s coverholder in the U.S.

Regarding RPS’ acquisition of Litchfield, a spokesperson for Gallagher said the firm does not comment on market speculation. A spokesperson for Litchfield did not immediately respond to a request for comment.