BP Marsh-backed specialty insurance distribution platform XPT Group has bought MGA and program manager International Property & Casualty Brokers of Nevada (IPC) in what is effecitvely a bolt-on acquisition by its Platinum Specialty Underwriters operation.
Based in Carson Valley, Nevada, IPC specialises in E&S insurance, with a focus on hired and non-owned auto.
It also offers the wholesale market a variety of complete packages for hard-to-place risks, including bars and taverns, vacant buildings and mobile home parks.
XPT said IPC’s management – made up of co-founders Tammy and Chris Sunderland – bring expertise and product knowledge in the hired and non-owned auto space, which will strengthen the group’s current product offering and wholesale distribution network.
In a separate statement, XPT’s MGU Platinum Specialty Underwriters said the addition would strengthen the offerings of its portfolio.
It added that the move continues its strategy of investing in MGAs that supply insurance products for hard to insure risks through the wholesale distribution channel.
Platinum currently operates a primary auto liability program for mid and large fleet trucking firms and has a number of new offerings launching in Q1 2021.
IPC will continue to operate under its existing brand name. Platinum Specialty Underwriters said it was advised by TAG Financial on the transaction, with IPC advised by MarshBerry.
Platinum Specialty Underwriters president Jeff Heath - also a co-founder of XPT - said: ”For nearly 25 years, Tammy and Chris have worked to develop a niche identity in the E&S insurance market. Our modern platform and collaborative culture will allow IPC to expand across the wholesale insurance industry offering brokers complete packages for tough classes of business.”
BP Marsh was a founding investor in XPT in 2017. The platform reported gross written premium approaching $400mn and adjusted Ebitda of circa $10mn for the year ending December 2020.
The purchase of IPC marks XPT’s eighth acquisition over the three years since its launch, having completed three acquisitions in 2020 including Houston Surplus Lines and LP Risk.
BP Marsh’s chief investment officer and nominee director of XPT Dan Topping said the acquisition of IPC is a continuation of the firm’s successful growth strategy of building a solid platform, bringing together both specialty underwriting and wholesale broking operations.
“BP Marsh looks forward to working with XPT in the future as they continue on this growth trajectory,” he added.
The acquisition will be funded by a previously announced debt facility provided by Madison Capital, the debt arm of New York Life Assurance Company.
Madison Capital took a minority equity stake in the business in September 2019 in a move that provided XPT with $40mn in aggregate financing.
XPT had an enterprise value of circa $54mn when Madison Capital acquired a stake in the platform in 2019. Updated valuation figures at 31 July 2020 implied an increased enterprise value of $86.4mn for XPT, according to BP Marsh.