Hg, a leading European investor in software and tech-enabled services businesses, is set to make a significant long-term equity investment in insurance intermediary Hyperion Insurance Group Limited, a transaction which values the business at an enterprise value of approximately $5 billion.
Together with an additional debt raise and existing resources, the investment by Hg will provide Hyperion with as much as $1.5 billion to accelerate its growth with selective acquisitions and investments in data and technology.
The transaction, of which the full terms were not disclosed, sees Hg join Hyperion as an aligned, long-term growth partner alongside General Atlantic and CDPQ, both of which remain committed to being partners of the re/insurance intermediary together with Hg.
Following the investment, Hyperion’s management team and employees will continue to be the largest shareholder group in the firm, with more than 1,000 individuals now owning shares. It’s expected that the deal will establish a sustainable, long-term capital model with core employee ownership supported by collaborative investment partners. This will enable Hyperion to expand Howden as a leading international challenger broker, and DUAL as international specialist MGA.
David Howden, Chief Executive Officer (CEO) of Hyperion, commented: “I am thrilled to welcome Hg as a long-term partner. During our conversations on A-Plan Group it was clear that Hg and Hyperion share an understanding of what building a business to last means for employees and clients. This, the quality of the Hg team, their support for our core employee ownership and our culture of empowerment, and the desire of the Hg partners to contribute to our digital and data strategy, makes them an excellent partner to join General Atlantic and CDPQ as we continue our journey.”
Howden, the broking arm of Hyperion, recently announced an agreement to acquire personal and commercial lines insurance broker, A-Plan Group from Hg. The European investor helped to drive a focus on embedding data and tech in A-Plan’s best-in-class service model over its investment period, and it’s hoped that this experience in tech will ultimately benefit Hyperion X, the group’s data and analytics operation.
The investment in Hyperion signals a continuation of Hg’s focus on insurance distribution and insurtech. Hyperion is Hg’s sixth investment in the wider sector over the past five years, with these businesses together totalling more than $1 billion of invested client capital.
Andrew Lard, Partner at Hg, said: “It is a privilege for Hg to back David and his fantastic team through this investment in Hyperion. The company is a unique and special business, driven by its outstanding culture and quality of talent, and it has a significant growth opportunity across the global insurance sector in the coming years.
“We got to know David during the recent sale by Hg of A-Plan Group to Hyperion, and it became clear that our long-term investment approach and specialism in technology were a great match for him and his team. In addition to providing capital, Hg’s deep knowledge of software and data will help Hyperion stay at the forefront of technology adoption across the insurance sector.”
Nic Humphries, Senior Partner at Hg, added: “This long-term investment in Hyperion reflects Hg Saturn’s strategy of backing entrepreneur-led growth businesses in software and tech-enabled services that are sector champions. In Saturn’s recent investments in Visma, P&I, Argus Media, Sovos and now Hyperion, we developed a trusted relationship with the founder or CEO over a long period, enabling us to offer them the investment structure they needed to meet their long-term plans. David and his team have built one of the global leaders in insurance distribution and we are excited in supporting them for many years to come.”
While Dominic Collins, Chairman of Hyperion, said: “I am delighted that Hg have chosen to become a partner alongside General Atlantic and CDPQ. It is a privilege to work with three partners who embrace our core ambition to build a sustainable and successful business, and who will help us to deliver on our strategy over the coming years at this very exciting time in the industry. The Hg team bring not only significant capital, but also considerable expertise and I look forward to welcoming them to the Board.”
