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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