By James Thaler

April 16 - (The Insurer) - Liberty Company plans to leverage its expanded credit facility to accelerate its M&A strategy and deepen investments in the build-out of its tech platform, while it continues to aggressively hire producer talent and keep its options open for a public listing.

The firm’s founder, chairman and CEO, Bill Johnson, detailed the firm’s go-forward strategy to The Insurer in an interview alongside chief financial officer Bernadetta Scholz, where they highlighted the significant strides the company has made in professionalizing its operations as a key part of its ambition to scale.

“Ultimately, it seems to boil down to one of those two,” Johnson said in the interview, outlining Liberty’s plans for both M&A and technology investments on the heels of the capital influx.

The Insurer reported in February that Liberty had upsized its JP Morgan-led credit facility by an additional $100 million, bringing total funding through the vehicle to $440 million.

“We've been able to keep our leverage low, which allows us to access financing at senior rate levels. We haven't taken the outside capital in the company to date. We've just been able to grow organically and through our credit facility,” Johnson explained.

Scholz said the company plans to focus on what she described as a strong M&A and producer hire pipeline, while touting the strides the company has made in improving the strength of its operations during her three-plus year tenure.

“We might be acquiring something that is adding capabilities to our platform,” Johnson noted, saying that for him personally, growing Liberty’s presence in the health insurance and benefits arenas are key priorities.

“We want our company to be in service to helping our people be healthier and happier, and providing an entrepreneurial platform, and we're taking a lot of those strategies around wellness out to our clients right now,” Johnson continued.

“We've built a nice platform that I think that we can scale in multiple areas,” Johnson said, specifically pointing to the firm’s small commercial, personal lines and high-net-worth division Liberty Select.

Among the key additions Liberty has made in the last year include Joe Clark, who leads Liberty Select and previously served as chief growth officer of Aon’s private risk management group, and has held roles at Willis Towers Watson and Nationwide.

Liberty has also onboarded a number of producer teams that have gone unannounced and been spearheaded by recently promoted president for strategic growth Adam Baillie.

“We're continuing to have a lot of conversations and I expect that that will continue. Overall, I like to think about having a healthy balance of organic and inorganic growth and over the last few years, we've certainly been able to achieve that so well,” Johnson said.

“We're not a roll up. I don't think of ourselves as a roll up at all. We're really building a culture, and we're scaling our business through attracting talent and acquiring people that align with our values and our culture,” he added.

‘PREPARING FOR WHATEVER OPTION WE THINK IS BEST’

Steps to professionalize its operations have been viewed internally as a critical step for the company to eventually list in the public markets.

“Frankly, we grew too quickly, and we got out over our skis and, and I think we made a wise decision as a management team to pause our M&A activity and just focus on our internal processes and procedures,” Johnson said.

Scholz said Liberty is “significantly more mature” in its approach to accounting and finance reporting, as well as in its operating controls.

After outlining the areas Liberty has worked to improve its operations, including how it integrates acquisitions with the firm’s existing infrastructure and product line capabilities, Johnson was asked whether a potential IPO of the business is on the horizon.

“What the next step is for us, nothing has been set in stone on that. We're preparing ourselves for whatever option we think is the best,” Johnson explained.

“In discussions with our board, I think that we will probably get a little bit more clarity as we move into the second half of this year about what exactly that step is going to be,” he continued.

“But as we sit (here today), I can't say (what) a definitive path is at this point,” Johnson added.

Meanwhile, Johnson is optimistic that as the year progresses IPO market conditions are likely to become more favorable, notwithstanding recent market volatility in the wake of the ongoing trade war.

“It seems that's where things are headed. Certainly, both public and private investors have shown that they love this business model. We're all blessed to be in the greatest business in the world,” he commented.

“It's going to be interesting to see how things play out. I think for me, I just keep focusing on our culture and trying to continue to operate with excellence and get better at that every single day, and all good things will stem from that,” he concluded.

“We believe that a fully integrated business is a better business, and it can have more success and synergies. That's the path that we've been heading down and over the last couple years, we've made a lot of progress,” he explained.

“Getting all the integration work done – there's still a bit left, but we've gotten through the lion’s share of it. And so, we're seeing the benefits of that, for our people to access resources, to share markets and all the things that come along with being a fully integrated firm,” Johnson concluded.