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Wachovia Corporation (www.wachovia.com), the nation's fourth largest bank holding company, will acquire Savannah, Georgia-based Palmer & Cay (www.palmercay.com), the third largest privately owned insurance broker in the United States. The addition of Palmer & Cay to Wachovia Insurance Services creates an insurance broker with more than $400 million in annual revenues and 1,800 employees, ranking it among the 10 largest in the nation.

Wachovia has completed about 10 acquisitions of insurance agencies and brokers over the past five years. Its most recent, and its largest before the Palmer & Cay acquisition, was Cameron Harris & Co. of Charlotte, North Carolina, which it acquired three years ago.

Palmer & Cay, founded 137 years ago, operates 34 offices in 22 states and the District of Columbia. Most of its offices are on the East Coast, in the Midwest, and Southwest. It has 950 employees.

The two firms have had strong corporate ties for several years. Stewart McDowell, who has served as president and chief executive officer of Wachovia Insurance Services, will continue in that role. John E. Cay III, chairman and CEO of Palmer & Cay, will become chairman.

McDowell and Cay see their combined firm as a good geographic and strategic fit. "It closes a lot of holes in our banking footprint," says McDowell. Cay adds that as part of Wachovia, the insurance broker "will be able to complete our expansion to the West Coast." Previously Palmer & Cay operated as far west as Denver.

Wachovia is also looking for opportunities to capitalize on cross selling possibilities between its banking business and insurance. "Cross-selling is a major strategy of ours," says McDowell.

"Clients are seeking professional service firms that look new and different from the traditional mega-broker model," states McDowell. "We believe the combination of Wachovia Insurance Services and Palmer & Cay offers this service model to current and prospective clients."

The transaction is expected to close in the second quarter of this year.

Beneficial Savings Bank (www.beneficialsavings.com) acquires Paul Hertel & Company of Philadelphia.

Paul Hertel & Company, founded in 1908, provides personal, commercial and specialty P-C insurance products as well as life, health and benefits. Paul Hertel & Company will maintain its name and continue operating at its headquarters at 325 Chestnut Street. Robert J. Bush, CPCU, remains as president of the brokerage firm.

Beneficial Savings Bank made the acquisition through its wholly owned subsidiary, Beneficial Insurance Services. Beneficial Savings Bank has 36 offices in the greater Philadelphia region, with six additional branches scheduled to open in 2005.

Encore Bank (www.encorebank.com) acquires John A. Bumstead & Associates of Houston.

John A. Bumstead & Associates, founded in 1961, specializes in personal lines. Its current staff will remain in place, as the agency becomes part of Town & Country, the insurance agency affiliate of Encore Bank.

Town & Country, acquired by Encore last year, has 31 employees and 10,000 customers. It offers personal lines and small commercial lines property/casualty insurance products, and has offices in Houston and Galveston. Its parent, Encore Bank, is privately owned. It operates eight branches in Houston and five on the west coast of Florida.

First Niagara Bank (www.fnfg.com) buys L.A. Lama of Ithaca, New York.

L.A. Lama Insurance Agency, Inc., founded in 1960, writes about $7 million in annual premiums. It serves more than 8,500 individuals and businesses with about equal emphasis on personal lines and commercial lines. Lama will change its name, becoming part of First Niagara Risk Management, Inc., the bank's wholly owned insurance subsidiary. Agency principal Robert A. Lama, will continue as a vice president.

First Niagara Risk Management has made eight acquisitions since 1999 and now has the second largest insurance agency in Buffalo, the eighth largest in Rochester and the fifth largest in the Albany area when ranked by premium volume.

First Niagara Bank has 116 branches and several financial services subsidiaries across New York State.

Hylant Group (www.hylant.com) expands its operations in Michigan by affiliating with Ann Arbor-based Dobson-McOmber to form Hylant of Ann Arbor.

Dobson-McOmber Agency is a full-service independent agency that has operated in soiitheast Michigan for over 100 years. Its owner, Steve Dobson, will retain an ownership interest in and serve as president of Hylant of Ann Arbor. John Hindle will retain his equity position and serve as senior vice president of the operation.

Hylant Group, a 70-year-old, privately held insurance agency, also has offices in Troy, Michigan; Toledo, Columbus, Cincinnati and Cleveland, Ohio; as well as Indianapolis, Bloomington and Fort Wayne, Indiana.

Old National Bancorp (www.oldnational.com) has agreed to acquire J.W.F. Insurance Companies, Inc., which does business as the J.W. Flynn Company, and J.W.F. Specialty Company, Inc., a related alternative risk services company. The transaction is expected to close in the second quarter.

J.W.F. provides risk management, insurance brokerage, and third-party administration services in central Indiana. With this acquisition, the ONB Insurance Group, the bank's wholly owned insurance subsidiary, expects to post annual revenue of $43 million and will employ nearly 325 associates. Old National is based in Evansville, Indiana.

S&T Bank of Indiana, Pennsylvania, (www.stbank.com) acquires the Bennett Group, which includes Bennett Associates of Ebensburg, Pennsylvania, and Cowher Nehrig & Co. of Patton, Pennsylvania.

Bennett Associates and Cowher Nehrig & Co. become part of Evergreen Insurance Associates, which the bank acquired three years ago. Both agencies will retain their existing office locations. Evergreen maintains offices in Greensburg and Ebensburg.

Texas agencies merge. Insurance and Bonds, Inc. (www.insurancebondsinc.com) of San Antonio, Texas, and Cadenhead Shreffler Insurance (www.cadenheadshreffler.com) of Hurst, Texas, merged effective March 1. The combined entity has approximately 85 employees.

In addition to construction surety bonds and insurance products, the new firm offers personnel management services, employee benefits, safety communication programs, and workers compensation claims management.

William B. Cadenhead is president and chief executive officer of the combined entity, and Pat J. Moore is chairman. Joining Moore and Cadenhead as partners in the company are Michael Hendrickson in the Dallas/Fort Worth region and Joe clayburne, Bryan Moore and Robert Nelson in San Antonio and south Texas.