Investment underscores Ardonagh’s successful transformation and significant growth over past five years and Group’s future growth prospects
Madison Dearborn Partners and HPS affirm their support of Ardonagh’s strategy
New co-investors of Madison Dearborn Partners and HPS include a wholly owned subsidiary of the Abu Dhabi Investment Authority and other large global institutional investors
The Ardonagh Group (“Ardonagh” or the “Group”) today announced a significant new equity investment into the Group led by existing long-term shareholders Madison Dearborn Partners, LLC (“MDP”) and HPS Investment Partners (“HPS”), alongside new co-investors through accounts managed by MDP and HPS, including a wholly owned subsidiary of the Abu Dhabi Investment Authority (“ADIA”), and several other large global institutions.
Under the terms of the transaction, funds affiliated with MDP will increase their shareholding in the Group and HPS will reinvest in the Group. Co-investors, including a wholly owned subsidiary of ADIA and several other large global institutions, will also acquire more than $1 billion equity through accounts managed by MDP and HPS as part of the transaction, which values Ardonagh at $7.5 billion.
David Ross, Group CEO, said: “The recommitment of both HPS and MDP continues a partnership that has helped Ardonagh grow into an international broking powerhouse. Continuity of ownership after six years is the optimum outcome for us, allowing management to focus solely on the execution of our strategy and the preservation of the unique Ardonagh culture. We are also delighted to welcome HPS and MDP co-investors to the Group. Their global, long-term ambitions are perfectly aligned with our own and those of our other shareholders, securing our goal of being a private enterprise for years to come. Today is a major milestone in Ardonagh’s journey and the achievement belongs to our greatest asset - every one of our people.”
Ardonagh was founded in 2017 with a mission to become the employer of choice for entrepreneurial leaders and producers, and the broker of choice for clients across Retail, Advisory, Specialty and International platforms. Ardonagh has grown to become a top 20 global insurance broker, placing $13 billion of premiums across the Group and within its networks on behalf of clients across the full spectrum of insurance risks.
As of 30 September 2021, Ardonagh had an LTM (Last Twelve Months) Pro-Forma Income of $1.5 billion and LTM Pro-Forma Adjusted EBITDA of $530 million. From 2016, which was the final year of operation for Ardonagh’s predecessor company, through 2021 (estimated), Ardonagh’s revenue and Adjusted EBITDA have increased at compound annual growth rates of 25% and 46%, respectively. The Group currently employs a global workforce of approximately 8,000 people across more than 100 locations.
Vahe Dombalagian, Managing Director and Co-Head of the MDP Financial & Transaction Services team, said: “We have supported Ardonagh since the formation of the Group and in that time, we’ve witnessed tremendous growth and diversification. Ardonagh has ample opportunity to continue to build on its platform and increase its reach and profitability, and by increasing our investment today we are reaffirming our commitment to continue supporting those efforts. We are proud to be a key shareholder behind the Ardonagh workforce and look forward to our continued partnership, alongside HPS and our and their new co-investors.”
Scot French, Governing Partner of HPS, added: “Throughout our multi-year relationship dating back to their first day at the Group, we have steadfastly supported the Ardonagh leadership team’s vision to build a best-in-class, global insurance brokerage platform. We are excited to remain meaningful investors in the Group as they continue to execute on their growth strategy.”
Hamad Al Dhaheri, Executive Director, Private Equities Department, ADIA, said: “We are pleased to partner with Ardonagh, alongside HPS and MDP, to support its strong management team in executing its global growth strategy. This investment continues to build on our strategy and track record of investing in market-leading businesses across the insurance industry value chain.”
The transaction is subject to customary closing conditions including regulatory approvals and is expected to close in the first half of 2022.
Fenchurch Advisory Partners is acting as the exclusive financial advisor to Ardonagh.
Notes to Editors
About The Ardonagh Group
The Ardonagh Group is the UK’s largest independent insurance distribution platform and a top 20 broker globally. We are a collection of best-in-class entrepreneurial and specialist brands with a network of more than 100 locations and a combined workforce of more than 8,000 people. Across our portfolio, we offer a highly diversified range of insurance-related products and services across the full insurance value chain in the UK, Ireland and broader international markets. From complex multinational corporations to individuals purchasing personal insurance policies, our understanding of the communities we serve, together with our scale and breadth, allows us to work with our insurer partners to deliver a broad range of product and risk solutions that meet customer needs.
About Madison Dearborn Partners, LLC
Madison Dearborn Partners, LLC ("MDP") is a leading private equity investment firm based in Chicago. Since MDP’s formation in 1992, the firm has raised aggregate capital of over $28 billion and has completed over 150 investments. MDP invests across five dedicated industry verticals, including basic industries; business and government software and services; financial and transaction services; health care; and telecom, media and technology services. For more information, please visit www.mdcp.com.
About HPS Investment Partners
HPS Investment Partners is a leading global investment firm that seeks to provide creative capital solutions and generate attractive risk-adjusted returns for our clients. We manage various strategies across the capital structure that include syndicated leveraged loans and high yield bonds to privately negotiated senior secured debt and mezzanine investments, asset-based leasing and private equity. The scale and breadth of our platform offers the flexibility to invest in companies large and small, through standard or customized solutions. At our core, we share a common thread of intellectual rigor and discipline that enables us to create value for our clients, who have entrusted us with approximately $75 billion of assets under management as of October 2021. For more information, please visit www.hpspartners.com.
Established in 1976, ADIA is a globally-diversified investment institution that prudently invests funds on behalf of the Government of Abu Dhabi through a strategy focused on long-term value creation.
ADIA, through its subsidiaries, has invested in private equity since 1989 and has built a significant internal team of specialists with experience across asset products, geographies and sectors. Through its extensive relationships across the industry, the Private Equities Department invests in private equity and credit products globally, often alongside external partners, and through externally managed primary and secondary funds. Its philosophy is to build long-term, collaborative relationships with its partners and company management teams to maximise value and support the implementation of agreed strategies.
The Ardonagh Group
(44) 020 7549 0999
(44) 07899 967 719
Madison Dearborn Partners
Deirdre Walsh or Hannah Gould
HPS Investment Partners
Mike Geller or Josh Clarkson
(646) 818-9018 / (646) 818-9259