b"SEQUEL ANDR FRAZO' The economic and market developments have resulted in transaction volumes increasing by as much as 300% in 2022'TURNING POINT ON THE SPANISH MARKET than in the Netherlands, but the decentralised Frazo continues: The Spanish economy has nowautonomy in the various federal states could make recovered from the banking crisis and the COVID- it more complex. This is particularly challenging lockdowns after some challenging years. Thisfor German insurersand to a lesser extent turning point is also clearly evident on thefor German intermediarieswhich is also why Spanish insurance distribution market. Similarthe consolidation drive among German insurers to the German and Italian markets, tied agentshas not taken off yet. About five years ago, it working for one insurer predominate in Spain.was challenging for a foreign investor to buy an In addition, the Spanish insurance market hadinsurance broker business in Germany, but there several independent broker platforms alongare now more than six private equity-backed with a significant number of small brokers. Foreignplatforms in Germany, which some of them are parties such as Howden, PIB Group, Acrisure, BMSbuying an average of ten companies each year, Group, Sderberg & Partners and a number ofsuggesting that we might be at an inflexion point. both local and international private equity playersThis has substantially increased the market entered the Spanish market en masse last year.dynamics, so now even smaller brokers are Not wanting to fall behind, these internationalopen to sell their businesses. When you get a platform companies have bought a significanthigh-quality management team and the right share of the largest Spanish intermediaries in theacquisition strategy, things can happen very last 24 months and are looking for a consolidationquickly on the German insurance market. When play in the years ahead, suggesting thatit comes to the acquisitions, broker platforms competition for targets will be fierce. Economicoperating on the German market have a well-and market dynamics have led to insurancestocked pipeline, and a runway for a decade. transaction volumes increasing by as much asHowever, valuations for broker businesses have 300% in 2022.been rising, and despite the pool of thousands of brokers, the businesses have been trading at POWERHOUSE GERMANY multiples similar to more mature markets, such as For international players, an untold potentialthe UK and the Netherlands according to Frazo.beckons with your neighbours across the.border to the east. Germany is one of theLOCAL FEET ON THE GROUNDlargest insurance markets in Europe and is highlyFrazo: In Germany, but also in many other fragmented, with over 20,000 independentEuropean countries, a local approach is a must. intermediaries. However, it remains conservative.You have to adapt to the language, culture The regulatory framework in Germany is less strictand regulatory framework of each market. 38 BHB DULLEMOND"