LONDON: B.P. Marsh & Partners PLC, a specialist investor in early-stage financial services businesses, said Wednesday that Sterling Insurance Pty Ltd, a general liability underwriting agency focused on Australia’s construction industry, has been acquired by ATC Insurance Solutions Pty Limited.
B.P. Marsh holds a 20% stake in Sterling and a 25% share in ATC, which will increase to 27% following the deal.
Under the agreement, ATC acquired Sterling for AU$33.2 million (approximately £15.9 million) in a mix of cash and equity. B.P. Marsh will receive AU$6.5 million (about £3.1 million) in ATC shares for its stake in Sterling, aligning with its valuation as of July 31, 2024.
The London-based investment group initially invested £1.9 million in Sterling in 2013, achieving an 8.8% internal rate of return over 12 years. It expects further gains through its increased ATC stake.
Dan Topping, B.P. Marsh’s chief investment officer, stepped down as a director of Sterling but remains on ATC’s board.
The deal allows Sterling’s management to reinvest in ATC while providing liquidity for long-term shareholders. B.P. Marsh said the transaction reflects its flexible investment approach in financial services.
ATC, Australia’s largest independent underwriting agency, expects to exceed AU$225 million in gross written premium this fiscal year, excluding the Sterling acquisition.
Chris Anderson, ATC’s chairman and managing director, said Sterling’s expertise in niche risks makes it a strong addition.
Tony Parington, Sterling’s chairman, praised B.P. Marsh’s support and said the merger would drive future growth.
Topping said B.P. Marsh looks forward to continuing its partnership with Sterling under ATC’s ownership.