insurance services

Main Street Scores on Sale of SambaSafety

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The recent sale of Safety Holdings (DBA SambaSafety), a provider of cloud-based data services on unsafe driving behavior, to ABRY Partners provided a home-run return to Main Street Capital.

SambaSafety’s customers include employers, insurance companies, background screeners and fleet management companies. The information is used to identify and address unsafe driving behavior and to allow insurance carriers to accurately price risk throughout the lifecycle of insurance policies. SambaSafety is led by its CEO Richard Crawford and is based in Albuquerque (www.SambaSafety.com).

In November 2011, Main Street provided both debt and equity to back the buy of the company by Cerca Group and Ticonderoga Private Equity. Main Street’s original investment in SambaSafety included a $3.0 million debt investment and a $1.0 million equity investment.  After the original investment in November 2011, Main Street’s investments grew to total debt investments of $26.4 million and total equity investments of $2.1 million as Main Street provided additional funding to support SambaSafety’s growth.

On its equity investment, Main Street realized a $28.4 million gain which results in an internal rate of return of 143.2% and a 14.6x multiple on its investment. On a combined basis, the debt and equity investment resulted in an internal rate of return of 34.7% and a 2.3x multiple on the investment.

As part of the acquisition of SambaSafety by ABRY, Main Street maintained a minority equity ownership position in the company.

Main Street Capital (NYSE:MAIN) provides long-term debt and equity capital to middle market and lower middle market companies in that generally have annual revenues ranging from $10 million to $150 million. Main Street provides “one stop” financing alternatives within its lower middle market portfolio. The firm is based in Houston, TX (www.mainstcapital.com).

© 2016 Private Equity Professional • Private Equity’s Leading News Magazine • 5-12-16

Aquiline Acquires NCA Group

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Worley Claims Services, a portfolio company of Aquiline Capital Partners, has signed an agreement to acquire NCA Group, a provider of insurance claims services.

NCA Group specializes in residential and commercial property claims management throughout the United States, Canada and the Caribbean. The company’s claims services platform is comprised of five operating units: Daily Claims; Catastrophe Claims; Commercial, Complex, and Large Loss Claims; Third Party Administration; and Temporary Staffing. NCA Group was founded in 1984 as National Catastrophe Adjusters and is headquartered in Indianapolis (www.ncagroup.com).

Worley Claims Services is one of the largest independent providers in the United States of property, auto, personal lines, and casualty claims adjustment services to national and regional insurance companies, commercial clients, and clients in the federal and state government sectors.  The company was founded in 1976 by Edward Worley and is headquartered east of Baton Rouge in Hammond, LA (www.worleyco.com).  Worley has been a portfolio company of Aquiline since October 2014 when it was acquired from Seaport Capital and Advantage Capital.   Seaport Capital and Advantage Capital acquired the company, then known as Worley Catastrophe Response, in May 2008.

According to Allen Carpenter, President and Chief Operating Officer of Worley, this add-on acquisition creates a market-leading diversified claims services company with an ability to mobilize one of the largest adjuster networks in the United States for both daily and catastrophe claims events.  “This is a transformational transaction for Worley and broadens our leadership position in comprehensive catastrophe management services to now include more daily and commercial capabilities, both areas that are strategically important to our growth,” said Mr. Carpenter.

Mr. Carpenter and Jim Pearl (President of NCA Group) will be responsible for the day-to-day operations of the combined company as Co-Presidents.  Michael Worley will remain Chief Executive Officer of Worley Claims Services.

StoneRidge Advisors, an investment bank that specializes in insurance transactions, was the financial advisor to NCA Group.  StoneRidge has offices in Chicago and New York (www.stoneridgeadvisors.com).

Aquiline Capital Partners invests in middle-market businesses across the financial services sector in banking and credit, insurance, investment management and markets, and financial technology.  The firm is based in New York (www.aquiline-llc.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 7-30-15

Lightyear Sells Paradigm to Summit Partners

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Lightyear Capital has sold Paradigm, a provider of outsourced catastrophic workers’ compensation case management services, to Summit Partners.

Paradigm provides its workers’ compensation case management services to insurance companies and self-insured employers.  The company was founded in 1991 and is headquartered near San Francisco in Walnut Creek, CA (www.paradigmcorp.com).

Paradigm has been a portfolio company of Lightyear since February 2012.  “We are very pleased with the outcome of this investment in Paradigm,” said Donald Marron, Chairman and Founder of Lightyear. “Under Lightyear’s ownership, Paradigm’s management successfully positioned the firm for the future with strong revenue and EBITDA growth in the three years we have owned the business.”

Lightyear makes control investments in North America-based, middle-market financial services companies. Subsectors of specific interest include asset management, banking, brokerage, financial technology, insurance, and specialty finance.  The firm is headquartered in New York (www.lycap.com).

“Our investment in Paradigm is a great case study of how Lightyear works with companies to develop and grow them,” said Mark Vassallo, Managing Partner of Lightyear.  “Paradigm is well positioned to continue its growth and market leadership under new ownership.”

Summit Partners, the buyer of Paradigm, provides private equity and venture capital for growth companies.  Founded in 1984, Summit has raised more than $16 billion in capital and has provided equity, recapitalization, and management buyout financing to more than 395 companies across a range of industries. The firm has offices in Boston, Palo Alto, London, and Mumbai (www.summitpartners.com).

2015 PEPD • Private Equity’s Leading News Magazine • 6-4-15

Lovell Minnick Acquires J.S. Held

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Lovell Minnick Partners has acquired a majority interest in J.S. Held and Held Enloe & Associates (J.S. HELD), specialty advisory firms providing outsourced insurance related consulting services.  The senior management team of both firms will continue to hold a significant minority interest in the combined company.

“We believe that an increasing propensity among insurers to seek third-party expertise when managing complex claims, coupled with the depth and talents of the J.S. Held and Held Enloe professionals, will result in significant growth opportunities for the company,” said Lovell Minnick Managing Director Bob Belke.

J.S. Held has extensive experience in property loss consulting, including estimating, scheduling and project monitoring.  Since founding in 1974, J.S. Held’s consultants have evaluated damage to more than 50,000 buildings and structures throughout the world and have experience working on all types of engagements including insurance claims related to commercial, industrial, high rise, special structures, governmental, residential, and infrastructure damages.  The company has a presence in over 20 locations throughout the US and is headquartered outside of New York City in Roslyn Heights, NY   (www.jsheld.com).

“With the Lovell Minnick investment, J.S. Held has a partner who shares our vision for growth. Through its depth of knowledge and focus on financial service firms, Lovell Minnick has an extraordinary track record of investing in growth-oriented companies in our sector,” said J.S. Held’s President and Chief Executive Officer Jonathon Held.

Lovell Minnick provides buyout and growth capital to companies in the financial services industry and manages private equity partnerships with committed capital totaling over $850 million. The firm is the successor to the private equity affiliate of Putnam Lovell Securities which was established in 1999 by Jeffrey Lovell and James Minnick. Lovell Minnick has offices in Philadelphia and Los Angeles (www.lovellminnick.com).

Deloitte Corporate Finance acted as financial advisor to J.S. Held and Held Enloe.  William Blair & Company acted as financial advisor to Lovell Minnick.

© 2015 PEPD • Private Equity’s Leading News Magazine • 3-31-15

Flexpoint Ford Exits VeriClaim

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Flexpoint Ford has signed an agreement to sell T&H Global Holdings and its subsidiaries (DBA VeriClaim) to Sedgwick Claims Management Services, a portfolio company of Kohlberg Kravis Roberts & Co. and Stone Point Capital.  VeriClaim has been majority owned by Flexpoint since March 2011. The transaction is expected to close within the next 60 days.

VeriClaim is a provider of specialized insurance claims services to insurance carriers, insurance brokers, corporations and public entities. Services include loss adjusting, third-party claims management. and fire and forensics investigation services. The company was founded in 1918 and is headquartered in the Chicago suburb of Naperville, IL (www.vericlaiminc.com).

“VeriClaim’s focus on providing exceptional claims services to a global customer base is unmatched in the insurance services industry and has allowed the company to extend its market leadership. By achieving strong organic growth and executing a successful acquisition strategy, the management team has delivered an excellent return for our investors and exceeded our high expectations,” said Chris Ackerman, a Managing Director of Flexpoint.

Flexpoint Ford seeks to invest from $10 million to $100 million in companies operating in the healthcare and financial services sectors. Flexpoint Ford currently has $1 billion in capital under management. The firm is based in Chicago with an additional office in New York (www.flexpointford.com).

“Flexpoint’s expertise in the insurance sector and strategic advice have been integral in growing VeriClaim into a market leading platform. Additionally, Flexpoint has been a valuable financial partner that has supported VeriClaim through multiple strategic acquisitions,” said Mike Arbour, Chief Executive Officer of VeriClaim.

Sedgwick Claims Management Services (Sedgwick) is a provider claims, productivity, managed care, risk consulting and other services to clients through a network of more than 200 offices located in the US and Canada. The company specializes in workers’ compensation; disability, Family and Medical Leave Act (FMLA), and other employee absence; managed care; general, automobile, and professional liability; warranty and credit card claims services; fraud and investigation; structured settlements; and Medicare compliance services. Kohlberg Kravis Roberts & Co. and Stone Point Capital acquired Sedgwick in March 2014 from Hellman & Friedman.  Sedgwick is based in Memphis (www.sedgwick.com).

KKR makes private equity, fixed income and other investments in companies in North America, Europe, Asia and the Middle East. The firm has $90 billion in assets under management. KKR was founded in 1976 and in addition to its New York headquarters the firm has offices in Menlo Park, San Francisco, Houston, Washington DC, London, Paris, Hong Kong, Tokyo, Beijing, Mumbai, Dubai and Sydney (www.kkr.com).

Stone Point Capital serves as the manager of the Trident Funds, which have raised more than $10 billion in committed capital to make investments in the insurance, employee benefits and financial services industries. The firm is located in Greenwich, CT (www.stonepoint.com).

2014 PEPD • Private Equity’s Leading News Magazine • 9-17-14

ABRY Exits York Risk Services Group

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ABRY Partners has entered into an agreement to sell its majority equity interest in York Risk Services Group, a provider of risk management, claims management and managed care services, to Onex Corporation for $1.3 billion. ABRY first invested in York in December 2010.

York Risk Services Group is a nationwide provider of customized claims handling, managed care, specialized loss adjusting, risk pool administration, loss control, consulting and other risk management services.  York provides these services to a variety of customers including self-insured companies, public entities, insurance carriers, insurance pools, alternative risks and insurance intermediaries. The company is based in Parsippany, NJ (www.yorksg.com).

“ABRY has been a great partner,” said Rick Taketa, President and CEO of York. “The support they have provided has helped make York a better organization.  We have enjoyed working with them and collaborating together.”

ABRY Partners invests in the media, communications and information sectors. ABRY is currently investing ABRY Partners VII (a $1.6 billion private equity fund), ABRY Senior Equity III (a $950 million senior equity/mezzanine fund) and ABRY Advanced Securities Fund II (a $1.2 billion senior debt fund).  Since its founding in 1989, ABRY has completed over $42 billion of transactions, representing investments in over 450 companies.  The firm is headquartered in Boston (www.abry.com).

“It has been our pleasure to work with Rick Taketa, Tony Galioto, and the world-class team at York,” said Brent Stone, a partner at ABRY Partners. “We have been pleased with York’s performance during our ownership and see a long future of continued growth for the company.”

Morgan Stanley & Co. acted as lead M&A financial advisor to ABRY. ABRY was also advised by Willis Capital Markets and Advisory. Kirkland & Ellis acted as legal advisor.

2014 PEPD • Private Equity’s Leading News Magazine • 7-16-14

CVC Capital Partners Acquires Cunningham Lindsey

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CVC Capital Partners and Allied World Financial Services have acquired majority ownership of Cunningham Lindsey, a loss adjuster and claims management company, from existing shareholders Stone Point Capital and Fairfax Financial Holdings.  Stone Point and Fairfax, along with the company’s management team, will remain substantial and active shareholders.

Cunningham Lindsey is a provider of independent loss adjusting and claims management services worldwide. In addition to its loss adjusting services, Cunningham Lindsey also provides engineering consultancy, risk management, risk survey, environmental remediation consultancy, valuation and related services. The company’s global network consists of approximately 7,000 people in 61 countries worldwide.  Cunningham Lindsey is based in Tampa (www.cunninghamlindsey.com).

Cunningham Lindsey’s management team, led by CEO Philippe Bès, will continue to manage the company, and Mr. Bès has joined the company’s Board of Directors.  “We are thrilled to have CVC’s support and expertise as we enter the next chapter of growth for our firm,” said Mr. Bès.  “CVC’s international footprint and significant resources will help us expand globally as we continue to deliver the unique capabilities and expertise that our clients look for from us.”

CVC invests in industrial and service businesses. To date, CVC has raised over $44 billion in capital completing over 290 investments in a range of industries and countries across the globe, with an aggregate transaction value of $169 billion. In total, the firm manages over $37 billion and is investing from CVC Tandem Fund, CVC Fund V and CVC Asia III. The firm is based in London, UK and has a network of 19 offices and 230 employees throughout Europe, Asia and the United States (www.cvc.com).

“We look forward to supporting the global growth strategy of Cunningham Lindsey and working with its management and existing investors to continue to be a highly valued service partner for the company’s clients,” said Kamil Salame, CVC Partner and Head of the U.S. Financial Institutions Group.

BofA Merrill Lynch, Morgan Stanley Senior Funding, RBC Capital Markets and UBS provided fully committed financing to CVC for the acquisition of Cunningham Lindsey.

Cunningham Lindsey was advised on the transaction by BofA Merrill Lynch, Debevoise & Plimpton and Wragge & Co. The CVC led investor group was advised by Willis Capital Markets and Advisory, Weil, Gotshal & Manges and Clifford Chance.

© 2012 PEPD • Private Equity’s Leading News Magazine • 12-11-12