5 December 2017Insurance

Hyperion secures $400m to fund growth

Hyperion Insurance Group received a $400 million investment from Caisse de dépôt et placement du Québec (CDPQ) which in turn acquired a “significant minority stake” in the group.

The transaction and a debt raise will provide over $300 million of additional capital for Hyperion’s global growth strategy, according to a press release. Selective acquisitions with a strong cultural fit will continue to play an important role in Hyperion’s growth strategy and the group has a number of deals in the pipeline.

CDPQ will join Hyperion as a long-term growth partner alongside General Atlantic. Hyperion management and employees will remain the largest shareholder group.

“CDPQ is a fantastic partner to support us on the next leg of our journey,” said David Howden, CEO of Hyperion.

“Their strategy to invest based on long term fundamentals combined with their deep understanding of insurance markets and significant international portfolio, mean they will deliver valuable insight to help direct our future plans, whilst remaining supportive of our independence and of our resolute focus on putting our clients at the centre of everything we do.”

He continued: “Since General Atlantic’s (GA) initial investment in 2013, the group’s revenue has grown by almost five times, our EBITDA [earnings before interest, taxes, depreciation and amortization] has increased from £36 million to over £150 million, and we have created very significant value for all of our shareholders. GA has been more than just an investor, it has been an active and collaborative growth partner whose intellectual capital, significant technological expertise, global resources and experience have played a central role in our success over the past four years, and I am delighted that they will continue to do so.”

Hyperion also plans to launch a debt refinancing, which will extend and reprice its existing term loan facility to 2024 and include the issuance of additional primary debt. Furthermore, Hyperion will extend its existing undrawn revolving credit facility. In conjunction with the CDPQ investment the funds provide over $300 million of additional capital for future investments, according to the statement.

For the financial year ended 30 September 2017, Hyperion reported preliminary unaudited revenue of £535 million and EBITDA of £152 million on a bank reported basis.

Hyperion comprises broking divisions Howden and RKH, and underwriting division DUAL.

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More on this story

11 January 2017   Intermediary Hyperion Insurance Group enjoyed strong growth in its full year ending September 30, 2016 with revenues increasing by 45 percent to £434 million compared with £299 million in 2015.
15 December 2017   Howden, the retail broking arm of Hyperion Insurance Group, has partnered with motor specialist Grupo Ordás, one of Mexico's top five brokers, to enter the Mexican insurance market.
11 January 2018   Hyperion Insurance Group enjoyed solid growth an increased profits in its annual results for the 12-month period ending September 2017, which it said was due to investment in people, operations and technology, and despite challenging market conditions.