Local insurance broker Acrisure closed two transactions that together raised over $3.4 billion to support its future growth and vision for technology initiatives.
Chicago-based BDT Capital Partners, a merchant bank that provides family- and founder-led businesses with long-term, differentiated capital, led a $3 billion investment, through its affiliated investment funds, into Acrisure’s senior preferred stock. The investment will support the company’s long-term objectives and will allow Acrisure to continue its position as one of the industry’s fastest-growing brokers.
In addition, a consortium of investors, attracted by Acrisure’s tech-enabled strategy and the recent acquisition of artificial intelligence leader Tulco’s insurance business, invested $454 million of new capital in junior preferred stock.
“These transactions are a clear reflection of how the market is valuing both the strength of our existing insurance brokerage business and … 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.
“Based on our data, AI foundation and global distribution capabilities, we will accelerate our growth in the insurance brokerage industry and into adjacent opportunities.”
The capital raise comes as Acrisure continues to navigate the COVID-19 pandemic via its partnership model and culture. In 2020, Acrisure acquired 110 agencies while also reducing its net debt leverage.
“Acrisure is an innovative leader in an attractive industry with a very strong management team led by … Greg Williams,” said Byron Trott, founder, chair and CEO of BDT Capital Partners. “We look forward to a long-term partnership with Greg and his team, consistent with our business model of providing patient capital to founder- and family-led businesses while leveraging our network of closely held business owners and investors to support the company’s growth and expansion.”
A portion of the proceeds from the investments was used to repurchase in full Acrisure’s existing senior preferred stock and certain warrants.
J.P. Morgan served as placement agent to Acrisure on the junior preferred stock offering.
Varnum LLP and Skadden Arps acted as co-counsel to Acrisure.
The Varnum team was led by partners Mike Wooldridge and Seth Ashby. The team was supported by partners Matt Maltz and Zach Meyer and associates Chris George and Justin Ooms.
The Skadden team included capital markets partner Dwight Yoo, counsel Michael Hong and associates Victoria Hines and Greta Riebe.
BDT was represented by Latham & Watkins for corporate work and McDermott Will & Emery for regulatory work.