EXCLUSIVE Carlyle to acquire NSM Insurance from White Mountains in $1.78 billion deal


The Carlyle Group logo is displayed at the company’s office in Tokyo, Japan October 17, 2018. REUTERS/Issei Kato

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May 9 (Reuters) – Private equity firm Carlyle Group Inc (CG.O) told Reuters on Monday it had agreed to acquire U.S. specialty insurance provider NSM Insurance Group from White Mountains Insurance Group Ltd (WTM.N) for $1.78 billion in cash.

Carlyle said the deal is expected to close in the second half of this year. The transaction is expected to add $280 per share to White Mountains’ adjusted book value.

NSM Insurance, based in Pennsylvania, is one of the largest independent insurance brokerages that underwrites policies for pets, nonprofits, workers’ compensation, trucks and behavioral health care. It generates more than $1 billion in bonuses from more than one million customers, according to its website.

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“We will be looking to reinvest a bit more into the platform and ramp up M&A activity,” Carlyle chief executive James Burr said in an interview. “There’s a lot of space in business-to-customer and improving technology.”

Private equity firms have driven consolidation in the insurance brokerage industry. Mergers and acquisitions in the insurance industry more than doubled in volume to a total of $58 billion in 2021, from $22 billion a year earlier, according to consultancy Deloitte.

In 2021, Carlyle sold its majority stake in London-based insurance brokerage PIB Group to private equity firm Apax Group for an undisclosed sum.

Carlyle has invested more than $10 billion in the financial services industry, including payroll services provider BenefitMall, US insurance claims firm Sedgwick Claims Management Services and Chinese group Ant.

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Reporting by Chibuike Oguh in New York Editing by Greg Roumeliotis and Will Dunham

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