Toronto-based conglomerate Onex Corp. has an agreement to acquire U.S. insurance company USI in a friendly deal valued at $2.3-billion US.
USI is a privately held affiliate of Goldman Sachs with more than 3,300 employees in about 100 offices across the United States, including a headquarters in the New York City area.
It deals in property and casualty insurance, employee benefits and retirement consulting.
Goldman Sachs, the New York-based investment banking giant, acquired USI in 2007. There had been media reports since September that it was seeking to sell the company.
USI owns division of TD insurance
Sumit Rajpal, a managing director at GS Capital Partners said, in a statement on Monday that "we are pleased with the company's performance over the last several years."
"Since our take-private in 2007, USI has successfully integrated operations and developed a common operating platform with industry-leading margins, differentiated acquisition capabilities, and a strong platform for organic growth," Rajpal said.
Onex is a Canadian conglomerate involved in a wide range of industries, including manufacturing, real-estate, movie theatres and sugar refining. It typically invests a relatively small amount of its own capital in friendly deals on behalf of itself and institutional partners.
The USI deal includes a $700-million equity investment in USI through Onex Partners III. Onex owns about 25 per cent of the partnership and manages it on behalf of itself and the other partners.
Once the acquisition is completed, USI will be co-owned by Onex, Onex Partners III and employees of USI.
Robert Le Blanc, an Onex managing director. said USI "is well positioned to continue to grow both organically and by building on its track record of successful acquisitions."
Among USI's recent deals was its purchase of a U.S. insurance subsidiary of TD Bank. That deal, announced in September, was expected to contribute $58.2 million in annual revenue to USI. Other terms weren't disclosed.
Mike Sicard, USI's chief executive officer, said in a statement that "we look forward to our next phase of growth in partnership with Onex."
Founded in 1994, USI operates in 26 states and has its headquarters in Briarcliff Manor, N.Y. It's ranked as the ninth largest insurance broker in the United States and 13th largest in the world.