December saw IAG find buyers for two parts of their UK business with private equity firm Aquiline Capital agreeing to acquire Equity Red Star for £87m and management led by Neil Campling acquiring Independent Commercial Brokers (Barnett & Barnett and NBJ) for £10m. On a more international scale HSBC has sold its 15.6% stake in Ping An Insurance, China’s 2nd biggest insurer, for $9.4bn. Markel is to acquire Bermudian insurer and reinsurer Alterra for $3.1bn.
Assured Partners in the US has acquired Lloyd’s broker Paul Napier through Grosvenor Brokers. Hampden Underwriting has acquired another £1m capacity Lloyd’s corporate member for £0.9m. Other deals included Randall & Quilter acquiring another company in run-off, LINPAC, Swinton acquired a commercial broker in Stroud and Markerstudy acquired motor broker Insurance Choice.
November was another relatively quiet month for Insurance M&A. Towergate/CCV completed a number of transactions (5) one of which was a first for them being Dawson Whyte in Northern Ireland; they also completed the acquisition of Norwich & Peterborough Insurance Brokers from Yorkshire Building Society. The Lloyd’s market has seen some movement with Grosvenor Brokers, with the backing of its US parent AssuredPartners, acquiring Paul Napier, Charles Taylor acquiring Global Life Assurance in the Isle of Man, Michael Wade selling out of Besso and Hampden acquiring a £0.9m capacity NameCo for £0.5m.
Elsewhere speculation continues about the plans for Acromas, Equity and Go Compare, while Esure gears up for a float. In the United States the acquisition of USI by Onex Corporation, a private equity firm with a newly opened office in London, for $2.3bn was announced subject to regulatory approvals and other conditions. Randal & Quilter has continued its acquisition of run-offs, this time Alma Insurance Company in Finland for £4.4m.
October has been a very quiet month for transactions in the UK general insurance sector. CVC has led the buyout of loss adjuster Cunningham Lindsey, Lightyear Capital has acquired a majority stake in Cooper Gay Swett & Crawford as speculated in our July report and Randall & Quilter has acquired 2 insurance companies in run-off. Other transactions involve the sale of a Lloyd’s NameCo to Hampden Underwriting and Berkshire Hathaway investing $100m in Torus Insurance, Bermuda.
Ageas confirms that it has reached agreement to acquire Groupama UK for £116m which will make it the 5th largest non-life insurer in UK and Ryan Speciality announces that it has acquired Direct Group from LDC and management. Gallagher has acquired Acumus, a specialist broker focussed on housing associations. Edmund Truell is rumoured to be looking at a major investment in the sector and is being linked to Equity and Direct Line. Direct Line has however announced its intention to float on the LSE.
Other transactions in the pipeline are Towergate and Norwich & Peterborough Insurance Brokers, Stackhouse Poland and LFC, AIM listed Tawa being up for sale and Cunningham Lindsey re-financing with a PE investor, now publicly announced as CVC.
Overseas Aviva has sold its Sri Lankan JV to AIG and QBE has sold its majority stake in QBE Macedonia to Vienna Insurance Group.
August was a relatively quiet month as one might expect, two US brokers increased their UK presence – Arthur J Gallagher acquired Blenheim Park and Integro acquired Allan Chapman & James. Towergate continued their acquisition trail with modestly sized Dean and Milward, Greaves Adams and control of Suddards Davies; Lucas Fettes entered the acquisition market with underwriting agency Cougar Underwriting joining their wholesale division. Lark completed its MBO with minority support from Hiscox.
In the claims arena Collinson announced its proposed acquisition of One Assist, whereas loss adjuster Merlin has gone into administration. Internationally Howden has acquired an Indonesian broker and Validus is seeking to acquire Flagstone Re.
The month started with Aviva selling part of its minority stake in Netherlands based Delta Lloyd for £321m, closely followed by HSBC’s sale of two Irish legacy businesses to Catalina, a Bermuda based run-off specialist. Gallagher acquired Contego Underwriting, a specialist underwriting agency focussed on the construction and engineering sectors and AmTrust acquired its sought after Lloyd’s platform in the form of Dore & Associates, with syndicate 2526. Towergate was back in action with two acquisitions, JBI International and Sheraton Insurance Brokers, with more to come from its pipeline.
Private equity continues to fuel speculation over Direct Line, HomeServe and a potential stake in Cooper Gay Swett & Crawford.
This has been a quiet month with only three UK insurance transactions of any material scale, Brit Group’s sale of Brit Insurance Ltd to Riverstone, part of the Fairfax Group of Canada, Direct Group’s acquisition of Simple Insurance Services from Primary Group and the MBO of Cobra Group for £7.3m, using Alto Intermediary as their acquisition vehicle.
RSA has bought in Canada, L’Union Canadienne for C$150m cash and Budget Group has sold in South Africa, subsidiary Fusion Outsourcing to Indian group WNS Holdings for £10m cash. After the Omega board backed the Canopius offer back in April the shareholders have now approved the deal at 67p, valuing it at £164m. Direct writers are attracting speculation with Direct Line Group being pursued by private equity and Esure being linked with Travelers.
This month has been more about speculation and possible transactions than completed deals; it was only just after the end of the month that the major news was announced, the acquisition of Windsor by Hyperion. This followed the mid-month sale of a 2.75% holding in Hyperion by BP Marsh to a fellow shareholder, valuing Hyperion at c.£165m.
At the beginning of May, Gallagher acquired Insurance Dialogue from IAG. Speculation continues about the future of IAG’s remaining UK business. Cobra is now only in discussions with Alto, led by the group’s chief executive, following the withdrawal of Towergate. RBS’ Direct Line continues to attract interest. Other small deals were completed by Giles (through Ink Underwriting), Northern Keep, County Insurance NW and Tom Bartleet.
April was another active month for Lloyd’s insurers with Canopius securing board backing for its bid for Omega with an increased offer of £164m, Flagstone Re has sold its Lloyd’s operation to ANV Holdings and Brit UK’s regional business has been sold to QBE. Canopius also bought a small underwriting agency, Golfplan, which will trade as a division of K Drewe Insurance Brokers.
The management of CFC Underwriting secured their buyout from Hyperion with the backing of a consortium of private investors and Lonmar has sold its Medicare International MGA to French broker April. COBRA announced that it is cooperatingwith two potential offerors, Towergate and Alto (a company formed by S Burrows the CEO of COBRA). On a more international note Admiral has sold its Italian price-comparison site to a French broker, BlackFin. Towergate (3), CCV (1) and Alan & Thomas (1) all completed small transactions in the month.
March saw the culmination of the Hardy takeover with US insurance group, CNA Financial, agreeing a £143m deal. This is the second Lloyd’s insurer to succumb to a US buyer in the last year and increases the speculation surrounding other companies.
Other transactions were much more modest with underwriting agents Professional Indemnity Protect being acquired by Barbican and Quay Underwriting being acquired by Markel International. Randall & Quilter has acquired NFIL, a Guernsey based captive insurer, John Holman acquired the non-marine business of London Market Insurance Brokers and the Besso management exercised a call option to buy 15% from BP Marsh, their private equity investor. LAS Claims Management has made its first acquisition, Waylett and Co, since its MBO in April 2010.
February has been a very quiet month for UK based insurance transactions with no material deals being completed. Towergate/CCV, THB and Tasker Ventures acquired small broking businesses and Aston Scott, The Insurance Partnership and Chester based Risk Services all acquired broking businesses that had gone into administration.
After a quiet start to the year Hyperion announced talks with Windsor with a view to floating the business in 2013. Groupama UK was confirmed as being up for sale, sparking speculation that the broking arms, Lark and Bollington, would be looking for MBOs. HSBC’s non-life business was being fought over by Axa and Ace and possibly QBE and Barbican launched a fresh approach for Omega with the backing of Carlson Capital.
Capita completed its acquisition of specialist broker Fish Administration, Allen & Allen completed a MBO backed by Darwin Private Equity and Burns & Wilcox acquired Lloyd’s broker Chesterfield. The management of the UK & Ireland arm of Europ Assistance also completed an MBO. Other deals were completed by CCV (two), Quindell Portfolio acquiring a minority stake in Ai Claims Solutions and AmWins completing with THB Group.