Cash generative Gallagher has options to top up M&A war chest for 2019
Strongly-performing US broker Gallagher has the firepower for even more acquisitions this year.
Gallagher had free cashflow of $641m in 2018, according to full-year accounts, just under half of which was paid in dividends to shareholders.
According to Morgan Stanley, Gallagher is issuing $600m of new debt, leading to a capacity of around $1.6bn for potential mergers and acquisitions.
However, Gallagher management are potentially looking at around $460m spend, which is between 30% and 40% higher than last year, the bank’s analyst said. Last year, Gallagher made 48 deals.
It kicked off 2019 with the the acquistion of UK broker Stackhouse Poland.
Gallagher rising M&A war chest comes after another quarter and full-year of strong results.
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Briefing: The financials behind why Gallagher is becoming a UK consolidating giant
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