Avid Insurance Ltd strengthens position in market with acquisition of Incorporated Insurance Group Ltd

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  • Agreement marks Avid’s first acquisition since the business was backed by Beech Tree Private Equity
  • Incorporated Insurance Group Ltd (IIGL) brings on board additional specialist underwriting expertise in the construction sector for SME clients
  • Shawbrook Bank has led and arranged Unitranche facilities to support a refinance and to part fund the acquisition of IIGL

Avid Insurance Ltd (Avid) has acquired specialist construction MGA Incorporated Insurance Group Ltd (IIGL) which takes the GWP of the combined business to c.£75m.

Avid’s move for IIGL brings diversification to its specialist insurance product lines.

Essex-based IIGL specialises in commercial insurance products to the construction industry, providing cover for SME’s which provide high hazard services such as roofers and scaffolders.

The acquisition of IIGL was part-funded via Unitranche debt facilities from Shawbrook Bank, who also supported a refinancing of the wider group.

 

Stephen Gibson, MD, Avid Insurance Ltd, said:

“This is a very exciting transaction for Avid and represents a big step forward towards meeting our medium-term growth ambitions.

“IIGL is a highly complementary business for our existing commercial portfolio. They have A-rated insurer support and share our underwriting-led business philosophy.

“We are also excited to have established a relationship with the Financial Sponsors team at Shawbrook who have been very supportive of our business plan from the very outset and look forward to working with them through our next chapter of growth.”

Avid Insurance, headquartered in Leeds and with offices in London, is a niche multi-disciplined specialist Lloyd’s broker and Managing General Agent (“MGA”) focused on schemes insurance, with core niches in social housing, leasehold and travel.

The firm’s USP is its underwriting strength, data-led approach and the expertise of its people allowing it to develop deep understanding of pricing, performance and profitability – thus strengthening its reputation as a ‘go-to’ provider for difficult-to-place insurance.

In 2019, Avid was subject to a management buy-out backed by private equity house Beech Tree Private Equity (BTPE). Since then, and alongside the Avid management team, they have pursued an organic and acquisitive growth strategy to develop and diversify the book of which IIGL is the latest acquisition.

 

Ben Cartwright, Investment Director, Beech Tree Private Equity, said:

“This is a bold and exciting move for a top-quality MGA and exactly the kind of transaction we hoped for when we invested in Avid just over a year ago. I am confident that all parties will achieve significant value from this acquisition.

“To ensure this project was completed quickly and seamlessly, we required the support of a lender that understood both the business and the sector and could operate quickly and efficiently to support us. The team at Shawbrook did just that and took a very pragmatic approach to structuring a flexible debt funding package that works for all – it was a real pleasure to work alongside them to finalise this exciting acquisition.”

 

Deepak Parekh, Senior Director, Shawbrook’s Financial Sponsors team, said:

“This was a unique opportunity to back a core sponsor in the form of Beech Tree Private Equity; an experienced mid-market investor who have a track record in both this sector and a highly rated management team at Avid which is very ably led by Stephen.

“For Shawbrook, this was an outstanding opportunity to support a business on its growth journey and we are delighted our funding support has enabled the successful acquisition.  Shawbrook is committed to helping SMEs across the UK achieve their goals as quickly as possible with finance arrangements that suit them and their business. This particular funding facility is testament to the speed and simplicity of the financing that we can provide – particularly in this example of supporting an ambitious sponsor-backed SME in the form of Avid.

“BTPE view this as both a strong organic growth equity story as well has having the added benefit of exploiting strategic bolt-on acquisitions of which IIGL is the first. We look forward to partnering with them for the rest of their growth journey.”

 

Shawbrook Bank’s legal advisor was Eversheds Sutherland LLP