Spencer Capital Holdings, a value-oriented global investment firm, has agreed to acquire USA Risk Group, the largest independent captive insurance manager in the world.
The transaction is subject to customary closing requirements and regulatory approval, and is expected to close during the first quarter of 2015. USA Risk currently serves over 300 clients, holding $9bn assets under management.
Financial terms of the transaction were not disclosed.
USA Risk is an independent captive insurance manager founded in 1981 by H. Lincoln Miller, Jr., a leader in helping to enact legislation enabling Vermont to become the pre-eminent captive domicile within the United States.
USA Risk has since established member companies in 10 additional, strategic locations, servicing 20 captive domiciles, inside and outside the U.S. market. USA Risk currently has 70 employees on and offshore.
The acquisition of USA Risk is immediately accretive to Spencer Capital and is complementary to its existing portfolio of companies.
The financial and operational support of Spencer Capital will provide USA Risk with the opportunity to grow and expand its client capabilities while maintaining its longstanding autonomy. Spencer Re, a reinsurance subsidiary of Spencer Capital Holdings, and USA Risk are expected to be mutual beneficiaries from cross-selling opportunities.
"USA Risk’s unparalleled reputation and leadership position in the captive industry is a welcomed addition to Spencer Capital Holdings as we seek to assemble a robust platform of leading and value-driven companies in the insurance and financial services industries," said Ken Shubin Stein, Chairman of Spencer Capital.
Commenting on the transaction, H. Lincoln Miller, Jr., Group Chairman of USA Risk, said, "We have been approached by many suitors over the years, but until we met the team at Spencer Capital, we did not view a transaction as being in the best interests of our customers and employees."
After the transaction closing, USA Risk will keep its name and continue to operate as it has effectively done for over 30 years. Miller, currently Group Chairman of USA Risk, will join the board of directors of Spencer Capital and Gary Osborne, currently President of USA Risk, will join the board of directors of Spencer Re.