Onex Acquires USI for $2.3 Billion
November 26, 2012
Kaye Scholer assisted longtime client Onex Corp. in its $2.3 billion acquisition of USI Insurance Services LLC from a private fund managed by Goldman Sachs Group Inc. Onex and Onex Partners III LP, its principal private equity fund, will make an equity investment of $700 million to help finance the deal. USI handles a variety of property and casualty insurance, employee benefits services and retirement consulting. Onex is a Canadian private equity firm with offices in Toronto, New York and London. The Kaye Scholer team was led by Partners Joel Greenberg and Thomas Yadlon, and included Partners Stephen Culhane, Jeffrey London, Phillip Geraci and Louis Tuchman, Counsel Peter Danias, and Associates Tess Fang, Damian Caputo, Viktoriya Karshenboyem and Brian Witkowski.
Below is a copy of the press release issued earlier today:
USI Insurance Services to be Acquired by Onex Corporation from GS Capital Partners
Monday, November 26, 2012
BRIARCLIFF MANOR, N.Y. -- USI Insurance Services ("USI”) announced today that a definitive agreement has been reached whereby Onex Corporation (“Onex”) (TSX: OCX), a leading private equity firm, will acquire USI from GS Capital Partners VI Fund, LP and certain of its affiliates (“GS Capital Partners”) in a transaction valued at approximately $2.3 billion. The transaction is anticipated to close by the end of 2012 subject to customary conditions and regulatory approvals.
Employees of USI invested alongside GS Capital Partners in a take-private of the company in 2007, and will remain significant investors in USI going forward.
With offices in Toronto, New York and London, Onex is one of the oldest and most successful private equity firms. Onex has approximately $14 billion of assets under management.
USI is a leader in the insurance brokerage market with a diversified mix of property and casualty, employee benefits and retirement consulting. Founded in 1994, USI is headquartered in Briarcliff Manor, New York, and has more than 3,300 employees in approximately 100 offices across the United States. USI is ranked as one of the ten largest insurance brokers in the United States.
“Our world-class brokers and investment in differentiating client solutions have allowed us to continually strengthen our market position by providing our clients with a level of value that is unparalleled in the middle-market,” commented Mike Sicard, Chief Executive Officer of USI. “GS Capital Partners has helped USI refine and shape its strategy during their ownership. We look forward to our next phase of growth in partnership with Onex.”
“USI has established a strong national insurance brokerage with a very impressive management team led by Mike Sicard,” said Robert Le Blanc, an Onex Managing Director. “The company is well positioned to continue to grow both organically and by building on its track record of successful acquisitions.”
Sumit Rajpal, a Managing Director at GS Capital Partners said, “USI’s management team and employees have demonstrated a commitment to growing and improving the business, and we are pleased with the company’s performance over the last several years. Since our take-private in 2007, USI has successfully integrated operations and developed a common operating platform with industry-leading margins, differentiated acquisition capabilities, and a strong platform for organic growth.”
Upon closing of the transaction, Onex and employees of USI will own 100% of the company.
Onex was advised by Morgan Stanley, with Morgan Stanley, BofA Merrill Lynch, Citigroup, Goldman Sachs, RBC Capital Markets LLC and UBS Securities LLC providing bank and bridge financing commitments. Legal counsel was provided to Onex by Kaye Scholer. GS Capital Partners was advised by Goldman, Sachs & Co. and RBC Capital Markets LLC. Legal counsel was provided to GS Capital Partners by Weil Gotshal & Manges.
With offices in Toronto, New York and London, Onex is one of the oldest and most successful private equity firms. Onex acquires and builds high-quality businesses in partnership with talented management teams. The Company has approximately $14 billion of assets under management, including $4.8 billion of proprietary capital, in private equity, credit securities and real estate. Onex invests its proprietary capital directly and as a substantial limited partner in its Funds.
Onex’ businesses have assets of $39 billion, generate annual revenues of $34 billion and employ approximately 235,000 people worldwide. Onex shares trade on the Toronto Stock Exchange under the stock symbol OCX. For more information on Onex, visit its website at www.onex.com.
The company’s security filings can also be accessed at www.sedar.com.
Founded in 1994, USI is the 9th largest insurance broker in the United States and the 13th largest in the world. USI is headquartered in Briarcliff Manor, NY, and operates out of approximately 100 offices across the United States. Additional information about USI may be found at www.usi.biz.
About GS Capital Partners
Since 1986, the Goldman Sachs Merchant Banking Division and its predecessor business areas have raised 17 private equity and principal debt investment funds aggregating over $82 billion of capital (including leverage). A global leader in private corporate equity investing, the GS Capital Partners family of funds focuses on large, high quality companies with strong management and funding acquisition or expansion across a range of industries and geographies. Founded in 1869, Goldman Sachs is a leading global investment banking, securities and investment management firm that provides a wide range of financial services to a substantial and diversified client base that includes corporations, financial institutions, governments and high-net-worth individuals. Additional information about GS Capital Partners can be found at www.gs.com/pia.
This news release may contain forward-looking statements that are based on management’s current expectations and are subject to known and unknown uncertainties and risks, which could cause actual results to differ materially from those contemplated or implied by such forward-looking statements. USI is under no obligation to update any forward-looking statements contained herein should material facts change due to new information, future events or otherwise.