(Reuters) – Canadian private equity firm Onex Corp said it would buy York Risk Services Group Inc, an insurance claims services provider, for $1.33 billion.
York offers insurance solutions to more than 6,300 clients in the property, casualty and workers’ compensation specialty markets in the United States.
The company has helped handle claims for each of the major hurricanes to hit the United States in the past 40 years.
Onex’s private equity investment platform, Onex Partners III, will invest about $560 million in equity in the deal, along with several co-investors, such as York’s management team and Onex itself, the company said.
Reuters reported earlier this month that York’s owner, private equity firm ABRY Partners, was in advanced talks with Onex for a sale of the company.
Private equity firms have been buying up insurance services providers in the recent past, attracted by their resilience in financial downturns.
KKR & Co LP, for instance, bought Sedgwick Claims Management Services Inc for $2.4 billion from private equity peer Hellman & Friedman LLC earlier this year.
The deal is expected to close in the third quarter, Onex said.
Toronto-based Onex’s shares closed at C$63.85 on the Toronto Stock Exchange on Tuesday.