Tiptree Inc. (NASDAQ:TIPT) (“Tiptree” or the “Company”), today announced the closing of the previously announced $200 million strategic investment in its insurance subsidiary, The Fortegra Group, Inc. (“Fortegra”) from Warburg Pincus, a leading global growth investor.
The investment gives Warburg Pincus an approximately 24% ownership in Fortegra on an as-converted basis. Up to $60 million of the proceeds will be used to support Fortegra’s growth opportunities with the remainder used to repay Tiptree’s existing indebtedness and for general corporate purposes.
This transaction highlights the underlying intrinsic value of Fortegra to Tiptree shareholders, representing a significant milestone for the Company. Fortegra is a rapidly growing and consistently profitable specialty insurer, underwriting over $2.3 billion of gross written premiums and premium equivalents annually. The business underwrites and administers a variety of specialty insurance products and warranty solutions across the United States and Europe.
Fortegra’s strong financial performance in 2021 and the first quarter of 2022 demonstrates the growth trajectory and consistent underwriting results of the business. With the backing of Tiptree and Warburg Pincus, Fortegra enters its next phase of growth focused on the specialty admitted and E&S lines, while maintaining its historically strong underwriting principles.
Advisors
Barclays acted as exclusive financial advisor and Ropes & Gray LLP and Sidley Austin LLP provided legal counsel to Tiptree and Fortegra. BofA Securities acted as exclusive financial advisor and Willkie Farr & Gallagher LLP provided legal counsel to Warburg Pincus.
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