London-based managing general agent Nexus Group has acquired aerospace MGA Altitude Risk Partners from Castel Underwriting Agencies for an undisclosed sum.
The deal will see Altitude become a trading division of Nexus Underwriting and the current Altitude underwriting team will join Nexus and move into the Group’s London headquarters.
The acquisition of the MGA via an asset purchase agreement will take Nexus’ forecasted 2018 ebitda to £15mn and income of £41mn.
Altitude was co-founded in 2014 by industry veterans David Godley, Richard Power and Tim Wright and was the first underwriting business to launch in partnership with Castel.
Altitude underwrites a portfolio of seven lines of aerospace insurance across 130 territories. Its gross written premium for 2018 is forecasted to be in excess of $80m.
Colin Thompson, founder and group CEO of Nexus, said: “ The completion of this deal marks our tenth acquisition in the last three years, our third so far in 2018 and our second in a week, making Nexus today the product of 12 acquisitions and two joint ventures with subsequent buy outs.”
Thompson added: “Now is an excellent time for us to be buying an aerospace MGA, with capacity being withdrawn, rates hardening, improving safety standards and increased focus on underwriting profitability across the market.”
“As a Group, we continue to target three acquisitions per annum, including transformational deals such as this which enrich our business with new expertise and solutions. We have a busy pipeline and will continue to proactively look for new opportunities that fit into our M&A model.”
Mark Birrell, CEO of Castel, said: “This is an important milestone in the development of Castel with Altitude being both the first of the 13 underwriting cells to launch on our formation platform and the first to exit.”
“The deal clearly demonstrates that our business model of supporting entrepreneurial underwriters in launching and building successful businesses is working,” Birrell added.
“This proven structure enables us to continue to identify and develop opportunities to bring other entrepreneurial teams to market.”
Richard Power, one of the founding partners of Altitude Risk Partners, said: “Castel’s incubation model has provided the support and infrastructure to enable ARP to enter the market and build a high quality business quickly.”
From this strong foundation we are now ready to take the business forward with an equally supportive partner in Nexus,” Power added.