£200m invested in London commercial insurance intermediary

One leading global buyout firm has recently invested £200 million in a London-based commercial insurance intermediary for a large minority stake in the business.

Advent International Monday has sunk a substantial sum into  Towergate Partnership Ltd.  Founded 14 years ago, Towergate is a specialist personal and business insurance product provider to small and medium-sized enterprises and individuals.  Towergate works through a network of companies which include Towergate Financial, Broker Network, Paymentshield, and Towergate Underwriting.  They also supply professional indemnity insurance products through sister company Cullum Capital Ventures.

Towergate has been acquiring more than 170 broking and underwriting firms since its initial set up in 1997.  Currently the firm generates in gross written premiums more than £2 billion every year across approximately 200 different insurance products. The £200 million investment made by Advent will be used to expand the business even further in an effort to reduce the fragmentation of a sector through continued acquisitions.

Advent International director, Nick Rose, stated that he was delighted to have the opportunity to provide monetary support to Towergate’s team. Mr Rose remarked that Towergate has been one of the swiftest growing companies in the past ten years;  additionally the firm has emerged as a market leader due to their efforts, he added.

Advent’s investment is meant to ensure Towergate will be able to continue it strategic acquisition of high-quality small and medium enterprise and specialist brokers.  Also the firm’s director stated an additional goal was to allow Towergate to continue to provide  its distinctively high level of customer service to its clients.

The conditions surrounding Advent’s investment include the requirement that Towergate complete a £570 million capital raising, which is expected to be finished by the middle of February. In order to raise the capital, Towergate plans to offer a high-yield bond in two parts.

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