New York-based private equity firm Lee Equity Partners has agreed to acquire majority stake in K2 Insurance Services for an undisclosed amount.
Founded in 2011, K2 Insurance Services is a specialty insurance services provider serving the property and casualty industry. The firm, through its MGAs, markets, underwrites and services more than $650m annually in niche commercial and personal insurance premiums.
In the past eight years of its establishment, K2 Insurance Services claims to have expanded its business across several specialty insurance lines while building a diverse, loyal network of distribution partners and carriers and reinsurers.
Upon closing of the deal, which is expected to take place in the second quarter of this year, the San Diego, California-based insurance company will retain a meaningful stake in the business.
As part of the deal, K2’s specialty insurance carrier, Aegis Security Insurance, will be spun off and will be owned by Endeavour Capital and Patrick Kilkenny.
K2 Insurance Services president and CEO Bob Kimmel said: “Since our founding in 2011, K2 has become one of the fastest growing and largest program managers in the U.S., with a focus on generating industry leading underwriting results for our carrier partners.
“With Lee Equity’s knowledge and experience investing in the insurance industry, we look forward to continuing to build on our proven track record of attracting high quality specialty underwriting teams, acquiring specialty MGAs, and growing organically.
“We will do this by offering our MGAs new distribution channels, technology enhancements and access to additional carrier partnerships.”
Lee Equity partner Mark Gormley said: “K2 has emerged as a market leader in the fast-growing MGA segment, and we are thrilled to partner with Bob and his team in K2’s next chapter of growth.
“K2’s differentiated platform is well positioned to continue revolutionizing the insurance sector by leveraging technology to achieve unparalleled operational efficiencies and deliver superior underwriting performance.”
For the transaction, TigerRisk Capital Markets & Advisory is acting as exclusive financial advisor to K2, while Evercore is acting as exclusive financial advisor to Lee Equity.