ADVENT International has agreed to invest £200m in insurance intermediary Towergate Partnership. Advent, a global private equity firm, will acquire separate shareholdings in both Towergate and Cullum Capital Ventures as part of the deal.
The deal, conditional upon Towergate raising new debt facilities through the bank and bond markets, is expected to be completed in mid-February.
Towergate says refinancing of its existing debt facilities will reduce its total borrowings and “establish a long-term capital structure on more favourable terms”. Towergate will also use the cash to pursue its acquisition-led growth strategy.
Towergate is the largest independent insurance intermediary in Europe, generating more than £2bn of gross written premiums a year.
Andy Homer, chief executive of Towergate, said: “This transaction follows a strong year for Towergate despite the ongoing tough economic conditions. We will continue to invest across our business and maintain a strong focus on acquisitions, a strategy which has delivered significant value over the last decade.”
Peter Cullum, chairman and founder of Towergate, said: “This marks an important milestone for Towergate and I am delighted to be working alongside Advent as our new private equity partner.
“Advent’s investment provides real firepower as the group reignites its acquisition programme as part of our ambitious growth strategy.”
ANDREW Sibbald was the lead banker on the Towergate transaction.
Sibbald is senior partner at Lexicon Partners, a corporate finance advisory business that he founded with others in 2000.
Lexicon Partners focuses on providing M&A, capital markets and strategic financial advice to companies in the financial services, utilities, infrastructure and energy sectors.
Since establishment, Lexicon has advised on over 225 transactions from its offices in London, New York and Hong Kong.
Lexicon deals in just the last four months have included advising Lloyd's insurer Brit Insurance on the £900m recommended offer by Apollo and CVC; fund manager Borealis Infrastructure with the Teachers' Pension Plan on their £2.1bn acquisition of the Channel Tunnel Rail Link from the UK Government; US utility Nstar on its $6.9bn merger with Northeast Utilities and Russian oil firm TNK-BP on its $1.8bn takeover of certain of BP's Vietnamese and Venezuelan operations.
Also on the advisory team for Lexicon was Nick Chapman, a partner at Lexicon.
DLA was also listed as advisers on the £200m investment by Advent International in Towergate Partnership.