KKR to Become USI’s Largest Shareholder with $1 Billion Investment

Private equity firm KKR announced on Monday that it will invest more than $1 billion in USI Insurance Services, a leading provider of insurance and employee benefit-related products to U.S. companies. The investment will make KKR the largest shareholder of USI, which it acquired in 2017 along with pension fund Caisse de dépôt et placement du Québec (CDPQ) from investment manager Onex for $4.3 billion, including debt.

Details of the Deal

As part of the agreement, KKR and USI will purchase shares of USI held by CDPQ and certain other investors. More than 50% of the USI shares held by CDPQ will be purchased as part of the transaction. CDPQ will remain a significant shareholder of USI, along with USI’s management team and employees.

The deal is expected to close in the fourth quarter of 2023, subject to customary closing conditions and regulatory approvals.

Rationale and Benefits

KKR said that it is making the investment to support USI’s growth strategy and capitalize on the opportunities in the insurance sector. KKR also praised USI’s performance and culture, saying that it has been impressed by USI’s ability to deliver superior value to its clients and partners.

USI said that it is excited to deepen its partnership with KKR, which has been a supportive and strategic partner since 2017. USI also said that it looks forward to continuing its mission of creating positive and lasting impact for its clients, associates, communities, and shareholders.

USI is one of the largest insurance brokers in the United States, serving more than 200,000 clients with over 8,000 associates in more than 200 offices nationwide. USI offers a range of services, including property and casualty, employee benefits, personal risk, retirement, and program and specialty solutions.

KKR is a global investment firm that manages multiple alternative asset classes, including private equity, credit, and real assets. KKR has over $400 billion in assets under management as of June 30, 2023. KKR has a long history of investing in the insurance industry, with previous investments in companies such as Alliant Insurance Services, Sedgwick Claims Management Services, and Mitchell International.