Searchlight invests in Penta-backed GRP

Katharine Hidalgo
04 February 2020

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Searchlight has made an investment in Penta Capital-backed insurance broker Global Risk Partners (GRP).

The firm will take a majority stake in the company, while GRP's founders and Penta Capital will retain minority stakes.

Searchlight is currently investing from Searchlight Capital II, which closed on $1.9bn in 2015. Searchlight Capital III was announced in March 2019. The fund will have an investment range of $100-200m.

GRP group managing director Mike Bruce will become CEO following the investment, David Margrett will become non-executive chairman, and Peter Cullum will remain on the board as a non-executive director. Prior to the deal, Cullum was the company's largest shareholder, according to press reports.

In January 2020, Apollo Global Management, Apax Partners, CVC Capital Partners and Centerbridge Partners were in discussions with the vendors about a potential £800m takeover, according to Unquote sister publication Mergermarket.

Ares Management will continue to provide capital to the company following the investment.

Previous funding
In 2013, Penta and founder Peter Cullum invested £50m in the company. Maven Capital Partners also invested £5m.

From 2013 to March 2019, the company acquired 54 businesses. These include Towergate Commercial Property Underwriting for £9.25m in 2013, Lonmar Global Risks in 2016 and Higos in 2017.

Company
Founded in 2013 and headquartered in London, the company now employs 1,600 people. It is a retail broker and a specialist managing general agent, and it operates several Lloyd's businesses.

GRP reported operating profit of £27.8m from turnover of £112.1m for the year ending in March 2019. It reported operating profit of £10.2m from revenues of £75.9m for the previous year.

People
Searchlight – Andrew Frey (partner).
Penta Capital – Steven Scott (founding partner).
Global Risk Partners – Peter Cullum, David Margrett (founders).

Advisers
Equity – RBC Capital Markets (corporate finance); Willkie Farr & Gallagher (legal).
Vendor – Dickson Minto (legal).
Company – Evercore (corporate finance); Slaughter and May (legal).
Management – Wyvern Partners (corporate finance); Proskauer Rose (legal).