HPS Investment Partners has agreed to make an investment in NFP, an insurance broker and consultant and a portfolio company of Madison Dearborn Partners (MDP) since July 2013. At closing of the transaction, expected in early 2017, Madison Dearborn will maintain a controlling stake in NFP, alongside NFP’s management and employees.
NFP (formerly National Financial Partners Corp.) provides employee benefits, property & casualty, retirement, and individual private client services. The company has more than 3,400 employees and provides its insurance brokerage and consulting services globally. Recently, NFP was ranked the 2nd fastest-growing US large-group employee benefits broker by Employee Benefit Adviser magazine; and the 5th largest global benefits broker by revenue, the 4th largest US-based privately owned broker and the 11th largest broker of US business by Business Insurance magazine. NFP is headquartered in New York (www.nfp.com).
“HPS’s investment in NFP is a further validation of the quality, performance and future opportunity of our business,” said NFP Chairman and Chief Executive Officer Douglas Hammond. “Partnering with these two investors provides us with tremendous intellectual and capital flexibility to further advance our growth initiatives and solidify our position as a world-class, diversified insurance brokerage and consulting leader.” Mr. Hammond will continue to serve in his current position and will remain the company’s largest individual shareholder.
HPS Investment Partners was originally formed as a unit of Highbridge Capital Management, a subsidiary of JP Morgan Asset Management. In March 2016, the principals of HPS acquired the firm from JP Morgan. Currently, HPS has over $33 billion of assets under management and approximately 100 investment professionals and over 200 total employees. The firm is led by its Chief Executive Officer Scott Kapnick and is headquartered in New York (www.hpspartners.com). Partner Scot French, led the transaction for HPS.
“We have an excellent working relationship with HPS, and we are pleased to have them join MDP as our partner in NFP,” said Vahe Dombalagian, a Managing Director at MDP and head of the firm’s Financial and Transaction Services team. “Together, we will utilize our combined expertise and resources in partnership with NFP’s leadership team to support NFP’s growth and build a strong, diversified business as we execute on our long-term vision for the company.”
Madison Dearborn Partners invests in privately held or publicly traded companies in the following sectors: financial and transaction services; business and government services; health care; basic industries; consumer; and telecom, media and technology services. In August 2016 the firm closed its seventh buyout fund at $4.4 billion. Madison Dearborn was founded in 1992 and is based in Chicago (www.mdcp.com).
BoA Merrill Lynch is serving as the financial adviser to NFP. Barclays is serving as financial adviser to Madison Dearborn. Ropes & Gray is the legal advisor to both Madison Dearborn and NFP. Fried, Frank, Harris, Shriver & Jacobson is the legal advisor to HPS.
© 2016 Private Equity Professional | December 12, 2016
