Ardonagh, the Irish-led owner of the Arachas corporate insurance broker group, has been valued at $14 billion (€13.4 billion) under a deal in which US private equity firm Stone Point Capital has made an investment in the business.
The deal values UK-based Ardonagh, which is led by Irishman David Ross, at almost double the level achieved in a previous fundraising round three years ago.
Completion of the deal is expected to take place in mid-2025, Ardonagh said in a statement. At that stage, Stone Point will become a significant shareholder, alongside fellow private equity firms Madison Dearborn Partners and HPS Investment Partners, a unit of the Abu Dhabi Investment Authority and a number of other investors, it added.
The transaction caps a pivotal year for the group, which began a refinancing in March, followed by the completion of the merger of its personal lines business into broker Markerstudy and the take-private of PSC Insurance Group in Australia.
“Stone Point’s investment in the Group marks a new phase in our extraordinary journey over the past few years to become the $14 billion business we are today,” said Mr Ross, who named the group after the Co Westmeath townland where he grew up. “Their support reflects a strong conviction in the strength of Ardonagh’s business and continued momentum, and redoubles our commitment to independence in a consolidating market.”
With Ardonagh’s backing, Arachas in Ireland continued to play a major role in ongoing consolidation across the insurance broker industry this year. Deals included the purchases of Gerry O’Mahony Insurances in Limerick, Tom Fogarty Insurance Brokers in Tipperary, Gilmartin Insurances in Leitrim, and Waterford-based broker McDonald Dwyer Reddy & Byrne in December.
Arachas, led by chief executive Joey Wynne, was acquired in 2020 by Ardonagh for €250 million in a debt-backed deal. Ardonagh was founded in 2017 through the merger of a number of UK brokers.
Mr Wynne took over as chief executive of Arachas in January as previous incumbent Conor Brennan, became executive chairman of Ardonagh’s international portfolio, including the group’s Europe and global partners units.
Mr Brennan said the deal “provides an excellent platform for Arachas to grow and supports our ambition to strengthen our presence within the Irish market”.
Arachas, which is chaired by former minister for finance Charlie McCreevy, posted a 30 per cent increase in net profit last year as it continued to play a big roll in ongoing deal-making across the sector.
The company’s profit rose to €40.3 million from €30.9 million for 2022 as turnover, mainly composed of commissions and fees, advanced to €113.4 million from €89 million, according to newly-filed accounts with the Companies Registration Office in last November.
Arachas paid out €38.7 million in dividends to holding companies within the wider corporate family last year. Still, the payout was down from €77.7 million recorded in 2022.
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