Fast-growing global insurance brokerage Acrisure announced it has closed on two transactions representing a significant capital raise of $3.45 billion.
BDT Capital Partners, a merchant bank, led a $3 billion investment through its affiliated investment funds into Acrisure’s senior preferred stock.
In addition, a consortium of investors Acrisure says were attracted by its tech-enabled partnership model and its July acquisition artificial intelligence (AI) firm Tulco’s insurance business, has invested $454 million of new capital in junior preferred stock.
Michigan-based Acrisure said these new investments will support the company’s long-term objectives.
“These transactions are a clear reflection of how the market is valuing both the strength of our existing insurance brokerage business and, importantly, our vision for accelerating our technology initiatives going forward,” said Greg Williams, co-founder, president and CEO of Acrisure. “These investments enable us to pursue strategic initiatives with aligned capital that will provide greater value for all shareholders.”
This announcement comes as Acrisure continues to expand its agency partnership model. In 2020, Acrisure maintained its industry-leading acquisition pace, acquiring 110 agencies, while also reducing its net debt leverage.
Acrisure’s agencies provide property/casualty commercial and personal lines insurance and employee benefits. The company reports it has grown to more than $2 billion in revenue, compared to $650 million in 2017.
In 2016, Acrisure completed a $2.9 billion management-led buyout of Acrisure along with a group of minority investors. Blackstone and Partners Group were part of the initial group of investors supporting the MBO. The firm is majority-owned by employees and has locations across six countries.
At the time of the Tulco acquisition, Acrisure said it planned to utilize AI to innovate in product development and sales and marketing. The Tulco deal, which Bloomberg valued at $400 million, was transacted as a stock-for-stock trade resulting in Tulco becoming a significant minority shareholder in Acrisure.
Founder and CEO Williams sees more growth ahead.
“Based on our data, AI foundation and global distribution capabilities, we will accelerate our growth in the insurance brokerage industry and into adjacent opportunities,” said Williams.
A portion of the proceeds from these new investments was used to repurchase in full Acrisure’s existing senior preferred stock and certain warrants.
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