By Devin Banerjee and Sean B. Pasternak Bloomberg News
TORONTO - Onex Corp., Canada’s largest publicly traded buyout firm, agreed to buy USI Insurance Services LLC from a fund run by Goldman Sachs Group Inc. in a transaction valued at $2.3 billion.
The deal includes a $700 million equity investment by Onex Partners III fund, the Toronto-based company said Monday in a statement. Employees of the Briarcliff Manor, N.Y.-based insurance broker will remain “significant” investors in USI, which has about 100 offices in the U.S.
Private-equity firms are buying insurance-services companies for their steady cash flow and low capital needs. KKR & Co. agreed on Nov. 23 to purchase brokerage Alliant Insurance Services Inc. from Blackstone Group LP for an undisclosed amount. Last month, a group led by CVC Capital Partners Ltd. said it would acquire insurance-claim adjuster Cunningham Lindsey Group Ltd. in a deal valuing the company at as much as $1 billion including debt.
USI “is well positioned to continue to grow both organically and by building on its track record of successful acquisitions,” Robert Le Blanc, a managing director at Onex, said today in the statement. USI, which has 3,300 employees, is the ninth-largest insurance broker in the U.S., according to its website.
The buyout unit of New York-based Goldman Sachs acquired USI in 2007 in a deal valued at $1.4 billion.
Morgan Stanley advised Onex, and Kaye Scholer LLP provided legal advice. GS Capital Partners received financial advice from RBC Capital Markets LLC, and Weil Gotshal & Manges LLP acted as legal counsel. The companies expect the deal to close by the end of the year.
Estate and Corporate Income Taxes are changing next year, and business owners and executives should know the details. The PBN Summit on November 6th will provide those details and more - including how much Obamacare's Employer Mandate could cost.
PBN's annual Book of Lists has been an essential resource for the local business community for almost 30 years. The Book of Lists features a wealth of company rankings from a variety of fields and industries, including banking, health care, real estate, law, hospitality, education, not-for-profits, technology and many more.