Marco in ‘transformational’ deal to acquire two speciality insurance businesses

European property and casualty (P&C) insurance run-off group  Marco Capital Holdings (UK) has agreed a “transformational” deal to acquire the speciality insurance businesses of  Capita.

The sale comprises two businesses: Capita Commercial Insurance Services (CCIS) and Capita Managing Agency (CMA). CCIS provides outsourced business processes for the insurance industry across areas including underwriting support, claims and client finance. CMA provides regulatory approval and oversight to live and run-off syndicates in the Lloyd’s insurance market.

The revenue and profit before tax for the speciality insurance businesses for the year ended 31 December 2020 were £26 million and £5 million,  respectively. These figures include a contract that is included in the sale and which is due to end in 2022. The revenue and profit before tax of the speciality insurance business excluding this contract were £20 million and £3 million, respectively.

The senior management team and employees of CCIS and CMA will remain with the businesses as they transfer to Marco’s ownership. This transaction will bring Marco Group headcount to over 300 insurance specialists. The sale is subject to regulatory approvals.

Capita previously announced its intention to sell a number of non-core businesses, including CCIS and CMA, in order to strengthen the balance sheet and focus on its two core divisions Capita Public Service and Capita Experience. The company is targeting £700 million of non-core disposals proceeds by June 2022.

Simon Minshall, chief executive officer of Marco, said: “I am delighted to announce the acquisitions of CCIS and CMA. These two long established businesses have tremendous growth potential in their core markets and Marco Capital will provide financial and other support to achieve this potential. While these businesses will operate on a standalone basis independently of Marco’s core Legacy business, they will substantially increase Marco’s operational capabilities as Marco will become a client of both companies -starting with CMA which has been appointed as Managing Agent for Marco’s new syndicate to be established at Lloyd’s and later contracting with CCIS for technical support services.”

Jon Lewis (pictured), Capita’s chief executive officer, said: “This is the seventh exit we have announced in the past 12 months. I am really pleased with this progress. Today is another step towards a more focused and sustainable business for the long term. Further progress on disposals will be announced as and when appropriate.”

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