Florida-based Roper Technologies has agreed to acquire insurance software maker Vertafore in an all-cash transaction valued at approximately $5.35 billion.
Roper said the Vertafore management team led by CEO Amy Zupon will continue to lead the business from its Denver, Colorado headquarters. Vertafore’s name, brands and office locations will not change as a result of the transaction, according to the announcement.
This is the third change of ownership for Vertafore in the past decade. Bain Capital and Vista Equity, current owners of Vertafore, acquired it in 2016 for $2.7 billion from TPG Capital, which paid $1.4 billion for the company in 2010.
It’s also the third insurance software deal announced within the past month.
Vertafore’s cloud-based software provides agency management, compliance, workflow and data products for the property/casualty insurance industry. More than 20,000 agencies and 1,000 insurance carriers use Vertafore software.
Roper owns a variety of niche market technology software and device firms including iPipeline, Logitech, ConstructConnect, Horizon, Strata Decisions, Metrix and iTradeNetwork.
“Vertafore is a fantastic business characterized by clear leadership in its niche market, a strong management team, high customer retention, and a long track record of consistent revenue and cash flow growth,” said Neil Hunn, Roper president and CEO. “The acquisition of Vertafore is a great example of our disciplined capital deployment strategy which focuses on durable, long-term cash flow compounding.”
Bloomberg reported back in October that Bain and Vista were considering a sale of Vertafore.
The deal’s announcement comes after two smaller insurance software transactions were announced in July. Cloud insurance software firm Majesco agreed to be acquired by Thoma Bravo, a private equity firm focused, in a transaction valuing the company at $594 million.
Also Sapiens International Corp. said it had agreed to acquire Delphi Technology Inc., a software vendor focused on the medical professional liability insurance carrier markets. The total consideration is up to $19.5 million in cash.
Roper said it anticipates funding the Vertafore transaction using its cash on hand, revolving credit facility, and new debt. Vertafore is expected to contribute approximately $590 million of revenue and $290 million of EBITDA in 2021. Roper expects the acquisition to be immediately cash accretive. The transaction is expected to close in the third quarter.
J.P. Morgan and Wells Fargo Securities served as financial advisors to Roper on this transaction.
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