Hellman & Friedman-backed insurance broker Hub International has secured nearly $1.6bn in fresh capital in a funding round led by T Rowe Price, and Alpha Wave Global, that values the firm at $29bn, according to a report by Reuters.
Singapore sovereign wealth fund Temasek also participated in the round. Hellman & Friedman (H&F) acquired Hub for $4.4bn in 2013, steering the Chicago-based brokerage through an aggressive growth strategy. It will retain a controlling interest following the latest capital raise.
The transaction marks the highest-ever enterprise valuation for a privately held insurance brokerage, further highlighting investor confidence in the consolidation strategy increasingly favoured by private equity sponsors in the sector.
“This type of deal signals strong conviction in the PE-backed brokerage roll-up model,” said Trevor Saliba, CEO of NMS Capital Group. “It also illustrates the continued preference for staying private, especially given the regulatory and market headwinds facing IPO candidates.”
Sources close to the deal suggest that the new injection of capital may delay any return to public markets – a decision becoming more common among private equity portfolio companies, many of which are using late-stage growth capital to extend hold periods and sidestep public scrutiny.
Since H&F’s acquisition, Hub’s annual revenue has more than quadrupled, driven largely by its aggressive acquisition strategy targeting middle- and upper-middle-market insurance brokerages. That M&A-heavy growth model, coupled with its focus on underserved market segments, has made Hub a standout platform in an increasingly competitive space for insurance assets.
Originally formed in 1998 through the merger of 11 Canadian brokerages, Hub previously traded on the Toronto and New York Stock Exchanges before being taken private in 2007.
Morgan Stanley and Goldman Sachs acted as financial advisers to Hub on the transaction.
