Boston Shop Expands Insurance Platform

Target: Bliss & Glennon Inc.


Sponsor: Summit Partners

Seller: Willis HRH Inc.

Financial Adviser: Sponsor: Piper Jaffray; Seller: StoneRidge Advisors, Willis Capital Markets and Advisory Services

Legal Adviser: Sponsor: Choate Hall; Seller: Pepper Hamilton

Summit Partners is guiding Fortegra Financial Corporation, its wholesale insurance brokerage portfolio company, into the wholesale property and casualty brokerage market with the company’s first major add-on acquisition under the firm’s ownership.

The Boston-based growth equity shop provided an undisclosed amount of equity to help Fortegra Financial buy Bliss & Glennon Inc. from Willis HRH Inc., the North American retail brokerage business of Willis Group Holdings, a global insurance broker.

Fortegra FInancial, headquartered in Jacksonville, Fla., provides payment protection products and services to customers in the banking, credit union, consumer finance, retail, credit card and automotive industries. Bliss & Glennon is a surplus lines broker offering a wide variety of property and casualty insurance products to retail insurance brokers. Its property insurance products include marine and earthquake insurance; it also offers casualty insurance products for artisan subcontractors, special events and liquor liability, and railroad companies.

Summit Partners has been searching for an entry into the wholesale property and casualty brokerage market since it bought Fortegra Financial in March 2007, J.J. Kardwell, principal and co-head of financial services, told Buyouts. The firm’s executives began working on the deal in late 2008, participating in an auction run by StoneRidge Advisors and Willis Capital Markets and Advisory Services.

Kardwell declined to discuss how much the acquisition cost. Summit Partners provided Fortegra Financial with equity for the deal and management of both Fortegra Financial and Bliss & Glennon also co-invested. Summit Partners also procured additional senior debt financing with Fortegra Financial’s existing lender, Columbus Bank and Trust Co. Summit Partners executives weren’t forced to renegotiate the terms of the financing for the original investment in Fortegra, Kardwell said.

Summit Partners acquired an 85 percent stake in Fortegra Financial in March 2007, tapping Summit Private Equity Fund VII, a $3.1 billion fund closed in 2006, and its $465 million sub-debt fund. Kardwell declined to say how much of Fund VII has been invested.

The firm has provided growth equity, recapitalization and buyout financing for more than 300 companies since its founding in 1984. It’s raised more than $11 billion in its history and has offices in Boston, Palo Alto, and London.