Business Moves
Private equity firm KKR and Canadian pension fund Caisse de depôt et placement du Quebec (CDPQ) have agreed to buy USI Insurance Services from Onex Corp. in a $4.3 billion deal, including debt.
The deal is the latest in a string of mergers in the insurance market, which has not grown quickly enough to support the smaller brokerages.
Valhalla, N.Y.-based USI had net debt of about $1.82 billion as of Dec. 31 and generated earnings before interest, taxes, depreciation and amortization of $353 million in 2016.
Canadian private equity firm Onex bought USI in December 2012 for $2.3 billion from Goldman Sachs Group Inc.’s private equity arm, funding $702 million of that through equity, and borrowing the rest with debt placed on the company.
The biggest deal last year in the insurance brokerage sector was the merger of Willis Group Holdings and Towers Watson, which created Willis Towers Watson Plc, a company with a $17 billion market capitalization.
In November 2016, Greg Williams, the chief executive of Acrisure LLC, an insurance brokerage that was controlled by private equity firm Genstar Capital, completed a $2.9 billion management buyout of the company.
USI has been active in buying small regional rivals. It has been seeking to beef up USI One Advantage, an interactive platform that helps the company share information with sales consultants sitting in offices around the United States.
The deal is expected to close by the end of the second quarter 2017.
New York-based KKR managed $129.6 billion as of the end of December, while CDPQ’s net assets under management totaled $270.7 billion.
In a separate deal, USI acquired Carolina First Associates LLC, an employee benefits insurance advisor located in Hickory, N.C.
This acquisition extends USI’s presence as a middle market insurance brokerage and consulting firm in the Southeast.
Carolina First Associates and its employees will remain at the current Hickory location following the acquisition. Terms of the transaction were not disclosed.
“Our depth of experience in the ever-changing era of healthcare reform has helped us to understand and overcome the high costs and limited options faced by most businesses,” said Samuel E. Rhodes, principal and owner of Carolina First Associates. “With this acquisition, our clients will continue to enjoy this high touch, specialized customer care, but now they can tap into USI’s expanded suite of employee benefits, retirement consulting and personal risk solutions.”
World Insurance Associates LLC has acquired Coverage Administrators Inc. of New York.
World Insurance Associates is an independent insurance agency headquartered in Tinton Falls, N.J. It offers extensive, cost-effective personal and business insurance solutions in 43 states. The company specializes in group benefits and insurance for transportation companies, the hospitality industry, coastal properties, high-net-worth individuals and general commercial clients.
Coverage Administrators Inc. has been offering risk management solutions as an independent insurance brokerage since 1997. As a family-owned firm, it works with businesses and individuals to develop personalized and comprehensive strategies and plans for clients.
Chicago-based global insurance brokerage Hub International Ltd. (Hub) has acquired the assets of BCI Group Inc. (BCI) and its subsidiary, Plus Point Services Inc. (Plus Point). Both are based in Portland, Ore.
Terms of the acquisition were not disclosed.
BCI and Plus Point specialize in employee benefits, retirement benefits, life insurance and business consulting. Robert (Bob) Coen, CEO of BCI, will join Hub Northwest and report to Tim Kennedy, executive vice president, Employee Benefits, Hub Northwest.
York Risk Services Group has acquired the stock of Latham, N.Y.-based Northeast Association Management Inc. (NEAMI).
York is a Parsippany, N.J.-based provider of claims management, managed care, specialized loss adjusting, alternative risk programs, pool administration and other insurance services. York Pooling, a division of York, provides pool management, underwriting, financial management, litigation and claims management, actuarial, and risk control services to public entity pools across the U.S. .
NEAMI, a pool and association manager, provides a range of services including operations management, information technology, financial management and strategic planning to the largest workers’ compensation trust for public entities in New York. As the pool’s administrator for more than 20 years, NEAMI has helped build a program that saves millions of dollars annually for the trust’s public entity members, which consist of municipalities, counties, school districts and special districts across the state.
Acentria Insurance has finalized its merger with Walker Insurance & Financial Services, Inc., located in Orlando, Fla.
Walker Insurance has specialized in personal and business insurance for local residents for more than 29 years and will continue to do so with the same team members. It will continue to operate out of its existing location and will slowly transition under the Acentria Insurance name.
Acentria Insurance is a full-service independent insurance agency that works with several national and regional carriers. The company offers protection for both individuals and businesses. While maintaining a corporate office in Destin, Fla., Acentria has more than 20 offices across the Florida and the Southeast.
Keenan & Associates, a Torrance, Calif.-based insurance consulting and brokerage firm, has entered into an agreement to join Lake Mary, Fla.-based brokerage AssuredPartners Inc.
Following the agreement, Keenan’s employees will continue operations under the current leadership of president and CEO Sean Smith. Smith and his current management team will continue to direct Keenan’s operations in its nine offices throughout California, and Smith will be joining AssuredPartners’ board of directors.
Keenan will also continue its focus on the public entity and healthcare markets, and will provide additional distribution for AssuredPartners in California.
The closing of the transaction is subject to customary closing conditions and regulatory approval. It is expected to be finalized in late March or early April 2017.
Avatar Partners LP, the parent company of Tampa, Fla.-based Avatar Property & Casualty Insurance Company (Avatar), has agreed to acquire Tallahassee, Fla.-based Elements Property Insurance Holdings LLC and its wholly owned subsidiaries, including Elements Property Insurance Company (EPIC).
The acquisition will expand Avatar’s scale and presence in the Florida residential property insurance market. The transaction is subject to regulatory approval and other customary closing conditions.
The transaction allows Avatar to expand the reach of its homeowners’ insurance products through EPIC’s distribution channels in Florida. Avatar will acquire approximately $65 million of Florida residential insurance in-force premiums and access to more than 500 Florida independent insurance agents.
Avatar Property & Casualty Insurance Company has provided repairs and solutions to policyholders for nearly a decade. It underwrites homeowners’ insurance, condo insurance, manufactured home insurance and commercial building insurance. The Avatar team also manages a fully integrated insurance company including sales, underwriting, customer service, claims and repairs.
Established in 2013, Elements Property Insurance Holdings LLC is an insurance holding company. EPIC writes residential property insurance in Florida through a network of more than 500 agents.
Rudd & Diamond, P.A. and Radey Law Firm are acting as legal advisor to Avatar. GC Securities and Barnett, Bolt, Kirkwood, Long & Koche are EPIC’s exclusive financial advisor and legal counsel.
Lighthouse Property Insurance Corp. Chairman and President Patrick L. White, has acquired an 89 percent ownership stake in Prepared Holdings, LLC and its wholly owned subsidiaries including Prepared Insurance Co. The Florida Office of Insurance Regulation has authorized the change in ownership, and the deal was consummated on March 10, 2017.
White now has controlling interest of Prepared and plans to enhance financial stability to support overall company growth, the company said i.
Prepared’s management team will remain in place and maintain its ownership interest. White will assume the position of chairman and CEO. Eric Gobble will continue as president and chief risk officer.
Prepared writes approximately $60 million of Florida residential insurance premium through a network of more than 500 independent insurance agents. Prepared Holdings is the parent company of a consolidated group of companies writing personal homeowners’ lines of business in Florida and Louisiana.
The Hilb Group LLC (THG) has acquired Manasquan, N.J.-based American Truck Insurance Exchange LLC (ATIE). The transaction became effective March 1, 2017.
THG is a Richmond, Va.-headquartered middle-market insurance agency. ATIE is a property and casualty insurance agency that specializes in the trucking industry.
All of ATIE’s employees along with the managing partners, Rich Minerva and Ryan Proud, are joining THG under its existing name and will continue to operate out of its office in Manasquan, N.J.
“With over 40 years in the insurance industry, Rich, Ryan and their team possess considerable experience in trucking insurance,” said Robert J. Hilb, founder and CEO of THG. “Not only is ATIE’s insight beneficial to our team, but the addition of their agency will expand our already substantial transportation operations in New Jersey.”
Combining forces will also allow ATIE to expand services for clients and establish new opportunities for associates.