International insurance group Hyperion, which counts broking divisions Howden and RKH, and underwriting division DUAL, at its core, has received an investment of over $400 million from pension funds in Québec managed by Caisse de dépôt et placement du Québec (CDPQ).
CDPQ is a long-term, institutional investor with a liking for insurance and reinsurance investments and assets. Hyperion is its latest investment in the re/insurance space, having invested recently in commercial brokerage USI Insurance Services LLC and before in run-off specialist Catalina, among others.
CDPQ is set to invest over $400 million in Hyperion, to provide new growth equity as well as liquidity to existing certain existing investors. CDPQ will be a long-term growth partner in Hyperion, alongside General Atlantic, but still Hyperion management and employees are the largest shareholder group.
Hyperion is also launching a debt refinancing, to extend and reprice an existing Term Loan facility to 2024 and include the issuance of additional primary debt, as well as extending its existing undrawn Revolving Credit Facility.
Together with the CDPQ investment, Hyperion will be “well placed to execute on its medium term growth strategy from a strongly capitalised position and with significant free cash, providing over US$300m of additional capital for future investments,” the company said.
David Howden, CEO of Hyperion, commented on the investment, “CDPQ is a fantastic partner to support us on the next leg of our journey. Their strategy to invest based on long term fundamentals combined with their deep understanding of insurance markets and significant international portfolio, mean they will deliver valuable insight to help direct our future plans, whilst remaining supportive of our independence and of our resolute focus on putting our clients at the centre of everything we do.
“Since General Atlantic’s initial investment in 2013, the Group’s revenue has grown by almost five times, our EBITDA has increased from £36m to over £150m, and we have created very significant value for all of our shareholders. GA has been more than just an investor, it has been an active and collaborative growth partner whose intellectual capital, significant technological expertise, global resources and experience have played a central role in our success over the past four years, and I am delighted that they will continue to do so.”
Stephane Etroy, Executive Vice-President and Head of Private Equity at CDPQ, added, “We are pleased to partner alongside David Howden, his management team and General Atlantic to continue Hyperion’s track record of success. Hyperion has a very strong entrepreneurial culture that has consistently yielded superior organic growth. This transaction allows us to support the Group in its global growth strategy while at the same time benefiting from a stable and counter-cyclical industry, together with a high-quality partner who shares our long-term vision.”
John Bernstein, Managing Director and Co-Head of EMEA, General Atlantic, also said, “Over the last four years we have enjoyed a strong working relationship with Hyperion over a period in which the Group has delivered market-leading organic growth, a transformational merger with RKH, and significantly invested in embracing technology and transforming its operational platform. This unique group has a bright future and we look forward to working with CDPQ and Hyperion as it continues its rapid growth in the provision of leading insurance services to its customers globally.”