Canadian long-term private equity firm Altas Partners has agreed to acquire a minority stake in Hub International Ltd, a Chicago-based insurance brokerage.
The deal, expected to close later this year, implies an enterprise value for Hub of more than US$10 billion.
U.S. private equity firm Hellman & Friedman (H&F), which acquired Hub in 2013 for about US$4.4 billion, will remain the company’s largest investor. The management team will also continue to hold an equity position.
Hub was established in 1998 with the merger of 11 Canadian insurance brokerages. It has continued to expand globally in part through acquisitions.
Altas Managing Partner Scott Werry said his firm will work with Hub and H&F to support the company’s “numerous growth opportunities.”
Earlier in 2018, Altas agreed to buy University of St. Augustine for Health Sciences for US$400 million.
Hub International Announces Minority Investment by Altas Partners
CHICAGO, Oct. 17, 2018 /PRNewswire/ — Hub International Limited (Hub), a leading global insurance brokerage, announced today that it has entered into an agreement with Altas Partners (Altas), a long-term oriented investment firm based in Toronto, Ontario. Under the agreement, Hub expects to receive a substantial minority investment from funds managed by Altas. Funds managed by Hellman & Friedman (H&F) will remain the largest investor in Hub and the company’s management team will continue to hold a significant equity position.
The transaction implies a total enterprise value for Hub of over $10 billion. During the trailing twelve month period ended on September 30, 2018, the company expects to report more than $2 billion in total revenue, up from $1.1 billion for the twelve month period ended prior to H&F’s acquisition of Hub in October 2013.
“This transaction is a strong validation of Hub’s strategy and vision for the future, as well as our long track-record of organic and acquisition-driven growth. All employees, past and current, have contributed to this great moment,” stated Marc Cohen, President and CEO, Hub International. “Altas’ long-term approach and deep expertise make them a welcome partner as we enthusiastically embark upon the significant opportunities ahead.”
Building on the company’s successful formula, Hub remains focused on bringing global resources to the local market via Hub’s network of regional brokerage offices. The firm continues to prioritize arming its producers and support teams with market-leading products and resources, while cultivating a culture of specialization to provide the level of expertise that Hub’s customers demand. Hub is making significant investments in delivering best-in-class customer experiences, including technology that accelerates the pace at which Hub can complete transactions and provide cost-efficient solutions meeting the evolving needs of customers.
Scott Werry, a Managing Partner of Altas said, “Hub has distinguished itself as the premier mid-market insurance brokerage through its unique regional structure and long, consistent track record of success. We have long-admired Marc, Marty Hughes (Hub’s executive chairman), and the entire Hub organization. Consistent with our investment philosophy, we look forward to working with the Hub management team and H&F as we support the numerous growth opportunities ahead of the company.”
The transaction is expected to close before the end of 2018 and is subject to customary closing conditions and regulatory approvals. Terms were not disclosed.
About Hub International
Headquartered in Chicago, Illinois, Hub International Limited is a leading full-service global insurance broker providing property and casualty, life and health, employee benefits, investment and risk management products and services. With more than 11,000 employees in offices located throughout North America, Hub’s vast network of specialists provides peace of mind on what matters most by protecting clients through unrelenting advocacy and tailored insurance solutions. For more information, please visit www.hubinternational.com.
About Altas Partners
Altas Partners is an investment firm with a long-term orientation focused on acquiring significant interests in high-quality, market-leading businesses in partnership with outstanding management teams. Key elements of the firm’s approach include prudent capital structures, active ownership through strategic and operational support and an emphasis on sustainable value creation. Altas invests on behalf of endowments, foundations, public pension funds and other institutional investors. For more information, please visit www.altaspartners.com.
About Hellman & Friedman
Hellman & Friedman is a leading private equity investment firm with offices in San Francisco, New York, and London. Since its founding in 1984, H&F has raised over $35 billion of committed capital. The firm focuses on investing in outstanding business franchises and serving as a value-added partner to management in select industries including financial services, business & information services, software, healthcare, internet & media, retail & consumer, and industrials & energy. For more information, please visit www.hf.com.
Media: Marni Gordon