Kester backs MBO of CETA Insurance

Kenny Wastell
02 October 2017

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Kester Capital has backed the management buyout of UK-based online insurance brokerage CETA Insurance.

Under its new ownership structure, CETA will undertake an organic and acquisitive growth strategy. Kester expects the company to continue to capitalise on the shift away from incumbent high-street insurance providers towards online-focused providers, founding partner Cameron Crockett told unquote".

Financial details of the transaction remain undisclosed, though Kester typically makes equity investments of £5-25m and CETA generated EBITDA of £2.2m in its most recent financial year, according to publicly available documents. The GP is currently investing from its second fund, which held a £93m final close in March 2013.

As part of the deal, John Bibby, formerly of BBI Worldwide and Primary Group, has been appointed CEO of CETA, while Swiftcover founder and AA non-executive director Andrew Blowers has been appointed as chairperson.

Debt
Cordet Capital Partners provided a unitranche debt package to support the transaction, according to Crockett.

Company
Founded in 1993 and headquartered in Chipping Norton, Oxfordshire, CETA is an insurance brokerage. The business operates via an online platform and focuses on niche segments including leisure insurance for caravans and small boats, and liability insurance for SMEs.

CETA has a headcount of around 120. It also operates through a network of 1,500 brokers and IFA members. According to public documents, CETA generated a turnover of £6.6m in the year ending September 2016 with EBITDA of £2.2m, up from £6m and £1.7m respectively year-on-year.

People
Kester Capital – Cameron Crockett (founding partner).
CETA Insurance – John Bibby (CEO).

Advisers
Equity – Cornerstone Corporate Finance (corporate finance); Grant Thornton (corporate finance); Deloitte (financial due diligence); Travers Smith (legal); HFW (legal).