Cadence Bank has agreed to divest its insurance operations, Cadence Insurance, to Arthur J Gallagher in a cash deal worth $904m.

Cadence Insurance provides a full suite of commercial property/casualty, employee benefits and personal lines products to clients.

Upon completion of the transaction, the Cadence Insurance team led by Markham McKnight and Chris Boone will operate under the direction of Gallagher Mid-South retail property/casualty brokerage operations head Bumpy Triche and Gallagher South-Central region employee benefits consulting and brokerage operations head Robby White.

With the sale, Cadence intends to redeploy capital to its core banking business.

In a press statement, Cadence said: “The significant capital creation bolsters the Company’s balance sheet flexibility and profitability profile while providing flexibility for capital redeployment to drive shareholder value.”

Cadence Bank chairman and CEO Dan Rollins said: “The sale will allow us to focus on what we do best – building strong, long-lasting banking relationships while also continuing to realise our long-term strategy.”

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Arthur expects the acquisition to expand its property/casualty and employee benefits presence across numerous US states and Texas.

It is also expected to expand Arthur’s capabilities across several practice groups, including construction, real estate, manufacturing, healthcare, professional services, and high-net-worth personal lines.

Following the sale, Cadence Insurance executive leadership, management and employees will join Gallagher.

Arthur said it will become Cadence Bank’s preferred insurance broking partner, as part of the transaction.

Subject to regulatory approval, the transaction is slated to close during Q4 2023.