Cinven, an international private equity firm, and British Columbia Investment Management Corporation (“BCI”), one of Canada’s largest institutional investors, today announce that they have reached an agreement to acquire Compre, a specialist global consolidator of closed books of non-life insurance policies, from CBPE Capital LLP. Financial details of the transaction are not disclosed.
Compre is focused on the acquisition and management of discontinued (also known as ‘run-off’) non- life insurance portfolios and has operations in the UK, Bermuda, Finland, Germany, Malta and Switzerland. The global non-life insurance run-off market is growing steadily, driven by insurers’ increasing focus on balance sheet optimisation, capital efficiency and disposals of non-core business lines. Compre has a proven track record of acquiring portfolios from major institutions including Allianz, Generali, HSBC and Swiss Re. Founded in 1991, Compre employs c. 80 people at its offices in the UK, Continental Europe, and Bermuda.
Cinven and BCI believe that Compre is an attractive investment opportunity based on:
Compre’s high-quality, cash and capital-generative business model, that delivers highly predictable long-term profits, with significant downside protection;
Its strong and established market position in the European non-life insurance legacy market and, more recently, its growing market position in the US market through its Bermuda platform, with further ambitions to enter the Lloyd’s market going forward;
Its track record of acquiring and managing non-life legacy businesses over more than 30 years, comprising 11 company acquisitions and 39 portfolio transactions across various jurisdictions across Continental Europe, the UK and the US;
Its proven financial track record of steady and consistent growth in recent years, delivering robust performance through the COVID-19 pandemic and prior downturns;
The significant opportunity to capitalise on the increasing demand for legacy solutions and offer its products to a broader range of international clients; and
An exceptional management and leadership team, led by CEO, Will Bridger, with significant expertise across its specialist areas.
The Compre transaction represents the second investment from Cinven’s new financial services sector-focused strategy, which will be focused on similar long-term investment opportunities across Europe.
Cinven Funds’ previous investments in the European insurance sector include Guardian Financial Services in the UK; Eurovita in Italy; and Viridium in Germany. Cinven recently announced an agreement to acquire Miller, a specialist insurance broker. Other financial services investments by the Cinven Funds include Partnership Assurance, NewDay, Avolon and Premium Credit.
BCI has made a number of investments in financial services companies, including Hayfin Capital Management, Verifone, and BMS Group.
Luigi Sbrozzi, Partner of Cinven, commented:
“Cinven is delighted to be investing in Compre alongside BCI. Over the last 30 years Compre has built a proven platform in the highly specialised insurance and reinsurance run-off market, and a reputation amongst its clients for consistently creating and realising value. Compre is extremely well placed to access new growth markets, such as the US and Lloyd’s, and to broaden its client offering further. We look forward to working with Compre’s management team to deliver these growth opportunities, drawing on the deep expertise of the Cinven team in the insurance sector.”
Jim Pittman, Executive Vice President & Global Head, Private Equity, BCI, said:
“We are impressed by the quality of the platform built by Will Bridger and his team and are excited to partner alongside Cinven to support the continued growth of the business. BCI's investment in Compre follows as a result of our proactive, sector focused origination strategy and relationship building efforts with the company. We look forward to supporting Compre in its development and in turn providing attractive and stable long-term risk-adjusted returns for our pension plan and insurance fund clients.”
Will Bridger, CEO, Compre, added:
“We are also delighted to be partnering with Cinven and BCI as we embark upon our next phase of growth. This has been a historic year for Compre. We completed our first US transaction, launched our Bermudian reinsurer and now, subject to regulatory approval, have new shareholders supporting further growth of the business. This was made possible through the commitment of everyone at Compre and our drive and determination for what we do. The legacy market is on an exciting trajectory and, together with our new shareholders, we will be best placed to deliver the ambitious plan we have for Compre.”
The transaction is expected to complete in Q2 2021 and is subject to regulatory approvals.
Cinven and BCI advisors included: Macquarie Capital (M&A); Allen & Overy and Latham & Watkins (Legal); PwC (Commercial, Financial, Actuarial, Operations, IT); FTI Consulting (Actuarial, Operations, IT, Communications); Deloitte (Tax, Structuring) and Marsh (Insurance).
Management advisers were Liberty Corporate Finance (Financial Advisor) and DLA Piper (Legal and Tax).