Stone Point Capital has agreed to acquire a majority stake in Ada, Oklahoma-based LegalShield, a provider of identify theft solutions. The seller is MidOcean Partners. The deal is expected to close in the second quarter of this year. Morgan Stanley, RBC Capital Markets and Three Ocean Partners served as financial advisers to MidOcean on the deal while Kirkland & Ellis provided legal advice. UPDATE: MidOcean is retaining a minority stake in LegalShield.
ADA, Okla.–(BUSINESS WIRE)–February 27, 2018– LegalShield (or the “Company”), the #1 subscription-based provider of legal plans and a leading provider of identity theft solutions, announced today that funds managed by private equity firm Stone Point Capital LLC (“Stone Point”) have entered into a definitive agreement to acquire a majority interest in LegalShield from funds controlled by MidOcean Partners (“MidOcean”). The deal is expected to close in the second quarter of 2018. Financial terms of the transaction were not disclosed. LegalShield’s management will be co-investing alongside Stone Point and MidOcean, which is retaining a minority stake in the business. The current management team, business model and employee base are not expected to change with this investment. The Company’s headquarters will remain in Ada, Oklahoma.
LegalShield’s mission since its founding in 1972 is to provide access to affordable legal coverage for all members — no matter how traumatic or trivial the situation. LegalShield offers subscription-based plans for legal and identity theft services and has grown to become the #1 subscription-based provider of legal plans to families and small businesses across the U.S. and Canada. The Company has a network of dedicated law firms in all 50 states and four Canadian provinces, with more than 39 provider law firms providing legal protection to over 1.7 million members.
The Company’s IDShield product provides its members with monitoring services to help members take control of their personal information and combat identity theft.
“We are very excited to begin our partnership with Stone Point and continue our relationship with MidOcean,” said Jeff Bell, LegalShield’s Chief Executive Officer. “Stone Point has tremendous resources and experience in the financial services sector and a proven track record of helping management teams drive their businesses to the next level. MidOcean has been a strong partner for us since their initial investment in 2011, and we look forward to their continued support going forward,” continued Bell. “I am so proud of our employees who provide service to our members day in and day out,” Bell added.
“We are incredibly proud of our partnership with LegalShield and the Company’s success. The management team has done an excellent job of growing its membership base, introducing new products and features, and expanding the Company’s distribution channels. We are excited to partner with Stone Point and believe their experience in the financial services sector, generally, and the voluntary benefits sector, specifically, will greatly enhance the growth opportunities for the Company,” said Frank Schiff, Managing Director at MidOcean.
Fayez Muhtadie, Principal at Stone Point, added: “We are thrilled to be partnering with the LegalShield team and MidOcean. We have a long history of experience in the employee benefits sector and see significant opportunities for the Company to expand its presence across channels and geographies. We look forward to working with Jeff and his talented management team to support the Company in its continued growth.”
Kramer Levin Naftalis & Frankel LLP served as legal advisor to Stone Point. RBC Capital Markets led the financing for the transaction. Morgan Stanley, RBC Capital Markets, and Three Ocean Partners acted as financial advisors, and Kirkland & Ellis acted as legal advisor, to MidOcean.
A pioneer in the democratization of affordable access to legal protection, LegalShield is one of North America’s leading providers of legal safeguards and protection against identity theft solutions for individuals, families and small businesses. The 45-year-old company has more than 1,751,000 members that are covered by its legal and identity theft plans. IDShield provides identity theft protection to one million individuals. LegalShield and IDShield serve more than 141,000 businesses. Both legal and identity theft plans start for less than $25 per month. LegalShield’s legal plans provide access to attorneys with an average of 22 years of experience in areas such as family matters, estate planning, financial and business issues, consumer protection, tax, real estate, benefits disputes and auto/driving issues. Unlike other legal plans or do-it-yourself websites, LegalShield has dedicated law firms in 50 states and four provinces in Canada that members can call for help without having to worry about high hourly rates. IDShield provides identity monitoring and restoration services and is the only identity theft protection company armed with a team of licensed private investigators on call to restore a member’s identity. For more information, call press and corporate relations at 580-436-1234. For more information please visit, www.legalshield.com.
About Stone Point Capital
Stone Point Capital LLC is a financial services-focused private equity firm based in Greenwich, CT. The firm has raised and managed seven private equity funds — the Trident Funds — with aggregate committed capital of approximately $19 billion. Stone Point targets investments in the global financial services industry, including investments in companies that provide outsourced services to financial institutions, banks and depository institutions, asset management firms, insurance and reinsurance companies, insurance distribution and other insurance-related businesses, specialty lending and other credit opportunities, mortgage services companies and employee benefits and healthcare companies. For more information please visit, www.stonepoint.com.
About MidOcean Partners
Established in 2003, MidOcean Partners is a premier New York-based alternative asset manager that specializes in middle market private equity and alternative credit investments. Since inception, the focus of the private equity funds has been on high-quality middle market companies with attractive strategic, operational and financial growth opportunities in the consumer and business services sectors. MidOcean Credit Partners was launched in 2009 and manages approximately $6.9 billion across a series of alternative credit strategies, collateralized loan obligations (“CLOs”), and customized separately managed accounts as of November 30, 2017. For more information please visit, www.midoceanpartners.com.