Bain reportedly in talks to lead $2 billion preferred equity investment in Acrisure

By David Bull

April 29 - (The Insurer) - Private equity firm Bain Capital is leading a group of investors that are in talks to invest as much as $2 billion into broker Acrisure in the form of a preferred equity investment, Bloomberg has reported.

The report cited people with knowledge of the matter, adding that while terms of the proposed transaction have not been finalised the deal would allow current backer BDT & MSD Partners to redeem part of its preferred investment.

BDT & MSD Partners led a $3 billion senior preferred investment in Acrisure in 2021. Acrisure also secured a $454 million junior preferred stock investment at that time that it said had an implied enterprise value of $17.5 billion.

At the time Acrisure had more than $2 billion in revenue but has since grown to more than $4.8 billion of revenue. Its expansion was initially fuelled by M&A as the most active acquirer of U.S. retail agencies for several years, as well as building out international, wholesale, MGA and reinsurance brokerage operations.

Its agency roll-up strategy has shifted to one more focused on integration in the last two years.

The Greg Williams-led company now describes itself as a fintech and has been public in its ambitions to eventually pursue an IPO after being mooted as a likely candidate for the last few years.

Almost two years ago Bloomberg reported that Grand Rapids, Michigan-based Acrisure was interviewing banks ahead of a potential IPO in 2024, and last July it announced it had hired New York Stock Exchange vice chairman John Tuttle as president.

Its other investors include a subsidiary of the Abu Dhabi Investment Authority, Guggenheim Investments and Oak Hill Advisors.

The potential preferred equity investment comes as brokers have been looking at a range of options for recapitalisations amid market volatility. For private equity-backed companies these have included minority stake sales and continuation funds.

Bain Capital has been an active investor in the insurance space, including through its Bain Capital Insurance division in the last few years.

Investments have included Keystone Agency Partners, The Mutual Group, Emerald Bay Risk Solutions and 1970 Group.

Bain Capital declined to comment. Acrisure did not immediately respond to a request for comment.