Broker Network chief executive Grant Ellis has said that the company is likely to receive further approaches in the coming months.
Ellis, who was speaking at the company’s third national conference in Cambridge, warned that prospective suitors would have to pay a considerable sum for the business, which recently completed its 22nd acquisition and increased its membership to 168.
He said: “I draw comfort from the fact that suitors like us because of what we do. We are in a strong position. Anybody who is interested will have to recognise that.”
Last month, following rapid appreciation of its share price, Broker Network announced it had received a preliminary approach from an interested party, thought to be Towergate. It was subsequently rejected.
At the time sources predicted that a renewed bid from the suitor was “inevitable”.
Ellis admitted that some of its membership had been “shocked” by speculation linking the company with a sale, but insisted that the majority had been reassured.
He played down fears that members would look to exit the network should it be acquired, but warned: “No one should buy a business assuming its customers will stick around.”
He added that the Broker Network would consider buying another network.
A source close to the company said that Broker Network had rejected a bid of £20m five years ago.
Despite recent speculation, the net-work’s share price has remained relatively stable over the past fortnight. As Insurance Times went to press, shares were trading at 508p, up 2.5% over the same period.
Ellis questions Layton Blackham's
Broker Network chief Grant Ellis has questioned the boast of rival network, Layton Blackham Business Solutions (LBBS), following its declaration last week to become the leading network within three years.
Ellis described AXA-owned LBBS's growth plan as 'ambitious', despite the fact that more brokers were looking to become part of networks.
He said: "network owned by AXA will have difficulty. It is starting from a long way back."
LBBS currently has 50 members. It plans to grow to 200 within three years.
Ellis said that LBBS would 'inevitably' have to invest heavily in order to serve its new membership, including in IT, which at present is mandated. He said: "[It] has the infrastructure to serve only its existing members."
LBBS insists that the network will remain independent of its parent company. It is targeting smaller brokers, with premium income of between £1m and £5m.
