PE-backed Ardonagh secures further investment at USD 7.5bn valuation

Greg Gille
16 December 2021

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Existing shareholders Madison Dearborn Partners (MDP) and HPS Investment Partners, alongside new co-investors, have made a new equity investment in The Ardonagh Group, a UK-based insurance company.

The new backers include a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA) and several other large global institutions, according to a statement. The deal is expected to close in H1 2022.

MDP funds will increase their shareholding in the group and HPS will also reinvest in the group. The new co-investors will acquire more than USD 1bn in equity through accounts managed by MDP and HPS as part of the transaction, which values Ardonagh at USD 7.5bn, according to the same statement.

US private equity houses HPS and MDP merged five of their jointly backed insurance firms under one holding company, underpinned by new debt facilities, in 2017. The assets included Towergate Group, Autonet, Chase Templeton, Ryan Direct Group and Price Forbes; they were merged into KIRS, which was rebranded later in the year to Ardonagh.

Company
Ardonagh is an insurance broker, placing USD 13bn in premiums across the group and within its networks on behalf of clients across the full spectrum of insurance risks. As of 30 September 2021, Ardonagh had a last-12-month (LTM) pro forma income of USD 1.5bn and LTM pro forma adjusted EBITDA of USD 530m. Between 2016 and 2021, Ardonagh's revenues and adjusted EBITDA have increased at compound annual growth rates of 25% and 46%, respectively, according to a statement. The group currently employs 8,000 people across more than 100 locations.

People
Madison Dearborn Partners – Vahe Dombalagian (managing director).
HPS Investment Partners – Scot French (governing partner).
Abu Dhabi Investment Authority – Hamad Al Dhaheri (executive director).

Advisers
Company – Fenchurch Advisory Partners (M&A).