Insurance and reinsurance broking group BMS has now secured a growth investment of up to £355 million from Eurazeo, a global investment company with €32.4 billion in assets under management.
The news broke at the end of November that BMS was considering taking on new investment, with some rumours suggesting a sale was possible.
However, we explained at the time that our sources suggested it was more likely the broker would be looking to build out its capital base to fund future growth, if any transaction was to occur.
So this morning’s announcement that Eurazeo has agreed to invest up to £355 million in BMS Group, in a deal to acquire up to 34% of its share capital, aligns with how the market had characterised this transaction when it was still pending.
Eurazeo and its affiliates are set to join as investors in BMS alongside its existing shareholders British Columbia Investment Management Corporation (BCI), Preservation Capital Partners (PCP) and BMS’ management and employees, but with Eurazeo and BCI being the majority shareholders from here on.
BMS values itself at a £1.75 billion level after this investment, a total enterprise value. The equity-only value is closer to £1.05 billion, based on the £355 million being up to 34% of the shares.
Between 2019 and 2022, revenues at BMS have grown to c.£100 million to more than £250 million, while its staff has increased roughly 75% to c.900 people globally.
The investment it has received with this deal is expected to fund continued expansion, with BMS aiming to increase its market stature as a global independent specialty insurance and reinsurance broker, through organic means and an active M&A strategy.
Eurazeo highlighted that the specialty re/insurance segment has been a key focus, with investments such as Albingia (the commercial P&C specialty insurer) and Descartes Underwriting (the parametric specialist MGA).
CEO of BMS, Nick Cook commented, “At a time when the macro-economic environment is causing headwinds for some, this investment is testament to the extraordinary growth and expansion we have delivered for several years and the confidence we have in our strategy to expand as a global independent specialty insurance and reinsurance broker. BMS has attracted immense attention over the past few months from global investors as we looked to position the business for an exciting future. The global reach of Eurazeo will undoubtedly help us in our ongoing expansion alongside the continue support of BCI and PCP. I am delighted to welcome Eurazeo, a prestigious listed global partner.
“Our culture and our dedication to recruiting and nurturing the very best people in the market is unique and steadfast. We are a home for top-flight, talented people with expertise, innovation, and who have entrepreneurialism at their heart. This ethos is a clear differentiator for our clients and runs to the core of everything we do.
“With our track record of organic double-digit growth, this investment, at a market leading valuation, has created the opportunity to scale this business with increased vigour and confidence. We have countless opportunities ahead of us in our specialty and reinsurance divisions. We now have three long-term capital partners who back BMS’ strategy and vision and, crucially, its continued independence.
“Our partners and our leadership team are committed to investment in our business and people to provide a market leading client service reinforced by data, digital and analytics. This is an exciting time for BMS, and I am grateful to all my colleagues at BMS who have driven our group success over the past few years. I could not be prouder of the achievements of the whole team.”
Maxime de Bentzmann, managing director, Eurazeo – Mid-large Buyout, also said, ”We have been exploring specialty insurance and reinsurance markets for some time and are delighted to have found, in BMS, another perfect opportunity to partner with a successful, global business with numerous transformation levers. Their shining record over recent years, under the leadership of Nick Cook and his management team, is one we admire, and we are genuinely excited to join forces to support their future success.”
“As a long-term investor, BCI is pleased to continue our significant investment in BMS, a market-leading company with a demonstrated track record of strong growth,” commented Dave Hong, senior managing director, Private Equity at BCI. “We are excited to partner with BMS management, Eurazeo, and PCP in the next phase of this journey, and to continue creating value for our pension plan and insurance fund clients.”
Jatender Aujla, managing partner, PCP, stated, “We are excited to welcome Eurazeo as a long-term shareholder in BMS alongside PCP and BCI. BMS is one of the largest investments PCP have made to date and, thanks to Nick Cook and his superb team, it has been a phenomenal investment to date with revenue and EBITDA tripling, resulting in a 3.5x uplift in valuation since our investment in 2019. As a long term investor we remain committed to helping the team continue their ambitious growth strategy.”