What are the next step for Jelf and Oval after Giles' admission that he wants to buy them?
Hugely inflated war chests are the latest must have accessory for the market's largest consolidators.
It is easy to say that the money is there and that acquisitions will follow, but until that cash has actually exchanged hands, the market waits in anticipation over who will be next to fall in the consolidation cycle.
Of course, predicting the next big move is the hardest part, though it helps when broker chiefs reveal their strategies, such as Giles chief, Chris Giles in last week's Insurance Times.
Openly, he expressed a desire to open talks with rivals Oval and the Jelf Group, following the Scottish broker's securing of a war chest worth £500m.
However, this week Jelf responded when chief executive Alex Alway issued a statement to the group's staff explaining that the company would not sell to Giles, reminding them it has its own recently refurbished war chest courtesy of 3i QPE, not to mention former Marsh UK chief Bruce Carnegie-Brown literally on board to spearhead the company's growth strategy.
It is now planning a further spate of acquisitions to follow up in its purchase of £45m GWP Manchester broker Manson, its first outside the South West. Gina Dixon, managing director of Jelf said: "There is a pipeline of activity on acquisitions." Meanhwile, in November, commercial director Phil Barton said that the broker was in discussions with as many as 40 acquisition targets.
Bob Hearne, managing director of PI specialist John Lampier & Son, acquired by Jelf last year, revealed the group would like to push in to the East and South East regions.
"There is no reason why we should not be pushing down to that region," he said. "The South West has got quite a bit bigger so it would be quite nice to join up a few dots between Manchester and Bristol."
Oval is also thought to be seeking a further boost to its own fighting fund by undergoing a refinancing operation. The difference between Oval, Jelf and Giles, however, is that the former is not expected to change its acquisitional profile.
"Phil Hodson will keep doing what he does best; buying smaller brokers," a senior market source explains.
While there is clearly a prevailing sense in the market that the consolidaotrs will come together at some point in the future, it seems that the latest comments are a case more of rhetoric than reality. Despite the evident need to create a counterpoint to Towergate and Venture Preference, the current picture suggests it could be a while before any of the three consolidators - Giles, Oval and Jelf - attack the market in unison.
