Insurance service provider Davies Group in an MBO
Tue, 11 Oct 2011 | MBO/MBI
Insurance service provider Davies Group has been bought by private equity firm, Electra Partners, from Lloyds Banking Group’s buyout arm, LDC, for £60 million in a secondary management buy-out.
In the three years since Davies Group was bought in an MBO in 2008, with £8.6 million of funding from LDC, it has seen its profits more than double to £8.4 million and its workforce expand to 600 from 400.
The Stoke-on-Trent-based business operates from 19 bases across the UK, and offers claims management, validation, loss-adjustment and claims fulfilment. It acts on behalf of a wide range of insurance firms including Lloyd’s of London, as well as service providers, self-insured entities and brokers.
Davies handles about 125,000 insurance claims per year, which equate to £500 million of insurers indemnity spend.
Law firm Osborne Clarke acted as adviser to the management team and LDC on the deal.
Robert Wood of Osborne Clarke said, “As everyone will be aware, market conditions over the last two years have not been easy. Despite that, the tangible growth achieved by the management team of Davies Group, with LDC’s support, is very impressive.”
“This demonstrates the benefits that private equity can bring to a business and, indeed, the wider economy, even during more challenging stages of the economic cycle,” he added.
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