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Associated Banc-Corp Unit Closes Diversified Insurance Deal

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Associated Banc-Corp’s (ASB - Free Report) subsidiary, Associated Benefits and Risk Consulting closed the deal to acquire Diversified Insurance Solutions, one of the leading insurance brokers of Wisconsin. The financial terms of the deal, announced in February 2018, were not disclosed.

Being a multi-line insurance consulting firm with nearly 400 employees, Associated Benefits and Risk Consulting is the 47th largest broker of U.S. business. It provides employee benefits, retirement plans, compliance, business insurance, risk management and individual insurance solutions.

Having similar business lines, the acquisition of Diversified Insurance will add a range of complementary services to Associated Benefits and Risk Consulting. In fact, based on 2017 data, Associated Banc-Corp projects that the combined firm will be among the top 45 insurance brokers in the United States.

As part of the transaction, some of the key executives of Diversified Insurance will continue their leadership roles for some time.

Philip B. Flynn, president and CEO, Associated Banc-Corp, said “We look forward to working with the Diversified team and further expanding our Wisconsin employee benefits and property and casualty market position and capabilities in the Metro Milwaukee market. These two strong teams can offer combined expertise and services that will benefit our existing customers while continuing to support communities in southeastern Wisconsin.”

Of late, Associated Banc-Corp has been on acquisition spree. Over the last six months, the company has acquired Bank Mutual Corporation and Whitnell & Co. These deals are projected to be accretive to its earnings.

Associated Banc-Corp’s solid organic and inorganic growth as well as branch consolidation efforts will enhance its long-term profitability. Driven by strong liquidity position, the company is expected to continue undertaking similar opportunistic acquisitions, going forward.

Shares of Associated Banc-Corp have gained 15.7% in the past six months, underperforming 19.8% growth of the industry. Mounting expenses and concerns related to the company’s limited geographic exposure seem to be the main reasons for this dismal price performance.



Associated Banc-Corp carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the same space are Old Second Bancorp, Inc. (OSBC - Free Report) , Enterprise Financial Services Corporation (EFSC - Free Report) and First Interstate BancSystem, Inc. (FIBK - Free Report) . All these stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Old Second Bancorp’s current-year earnings estimates have remained stable over the last 60 days. Its share price has increased 26.9% in the past six months.

Enterprise Financial’s earnings estimates for the current year have been revised 13.1% upward over the past 60 days. Its shares have gained 26.6% in the past six months.

Over the last 60 days, First Interstate BancSystem witnessed an upward earnings estimate revision of 9.6% for the current year. Its share price has increased 15.9% in the past six months.

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