Carlyle Group In, KKR Out as Sedgwick Majority Investor in $6.7 Billion Transaction

Global claims services firm Sedgwick announced today that funds managed by The Carlyle Group have agreed to become the majority owner of Sedgwick in a transaction valued at approximately $6.7 billion.

Current majority shareholder KKR will fully exit its position following the transaction. KKR and company management paid $2.4 billion in 2014 to buy Sedgwick.

Funds managed by Stone Point Capital LLC and Caisse de dépôt et placement du Québec (CDPQ), together with Sedgwick management, will remain minority investors.

On an annual basis, Sedgwick handles more than 3.6 million claims and has fiduciary responsibility for claim payments totaling more than $19.5 billion.

The parties said they are working to close the deal later this year.

Equity capital for the investment will come from Carlyle Partners VII, an $18.5 billion fund that focuses on buyout transactions in the U.S., and Carlyle Global Financial Services Partners III, L.P., a dedicated financial services buyout fund.

Sedgwick serves the claims needs of casualty, property, marine, benefits and other lines.

The Carlyle Group is a global alternative asset manager with $210 billion of assets under management.

“We are grateful for the strong and value-added partnership with KKR over the last handful of years,” said Dave North, president and CEO of Sedgwick.

“We have greatly valued our partnership with Sedgwick and its exceptional management team,” said Tagar Olson, director of Sedgwick, member of KKR, and head of KKR’s financial services investing efforts. “We look forward to watching the company’s continued success in delivering high quality technology-driven insurance solutions to clients and consumers around the globe.”