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NEW YORK (Reuters)—The owners of AmWINS Group Inc., the largest wholesale insurance broker in the United States by premiums placed, have put the company up for sale expecting a valuation of about $1.5 billion, three people familiar with the matter said Tuesday.
An auction for a majority stake in AmWINS, which owns brokerage, underwriting and group benefit operations across 21 countries, is under way and has attracted interest from private equity firms and strategic buyers, the people said.
AmWINS is owned by its management and by buyout firm Parthenon Capital Partners L.L.C. Parthenon plans to sell its 50% stake, and management also will be ceding some of its ownership, offering the buyer control of AmWINS, one of the people said. The exact stake for sale is open to negotiations, the person added.
A $1.5 billion enterprise valuation for AmWINS would equate to about 13 times its 2011 earnings before interest, tax, depreciation and amortization (EBITDA) of $117 million, another person said.
Representatives of AmWINS and Parthenon did not immediately respond to a request for comment.
Deal making in the U.S. financial services sector has been subdued for private equity firms, although a couple of buyout firms recently exited from investments in insurance companies.
Last month, BB&T Corp. agreed to pay $570 million in cash for the life, property and casualty insurance operations of Crump Group Inc. to J.C. Flowers & Co L.L.C., about nine times projected EBITDA and 1.8 times projected revenue.
U.S. insurance broker Brown & Brown Inc. said in December that it agreed to buy Arrowhead General Insurance Agency Inc. for $395 million in cash from Spectrum Equity Investors, JMI Equity and a management equity-holder group.
Parthenon bought a majority percent stake in AmWINS in 2005. AmWINS subsequently registered for an initial public offering but withdrew the filing in 2007. The company has since grown aggressively through acquisitions and currently handles over $6.7 billion in annual premiums.
Financial Technology Partners L.P. is advising AmWINS on the sale, while Goldman Sachs Group Inc. is providing staple financing for the transaction.
AmWINS Group Inc. ranks No. 1 in the 2011 Business Insurance ranking of the largest property/casualty insurance wholesalers.