Assurant, Inc., a premier global provider of risk management solutions, and The Warranty Group, a leading global provider of protection plans and related programs, and a portfolio company of TPG Capital, today announced that they have entered into a definitive agreement to combine operations, with Assurant shareholders retaining majority ownership of the combined company. The transaction is valued at approximately $2.5 billion and is expected to close in the first half of 2018, subject to shareholder and regulatory approvals, and other customary closing conditions.
The transaction will significantly advance Assurant’s strategy in the global lifestyle market with an attractive product and client portfolio, diversified growth profile and a deeper global footprint. With annualized revenue greater than $1 billion as of June 30, 2017,1 The Warranty Group will enhance Assurant’s scale and market presence in its vehicle protection, extended service contracts and financial services businesses across 35 countries. The resulting geographic footprint also will provide resources to accelerate Assurant’s mobile strategy in key markets such as Asia-Pacific. The Warranty Group’s U.S. vehicle protection business also brings new client partnerships and distribution channels including dealer networks and national accounts, and positions Assurant to capitalize on emerging trends in the auto market such as digital auto retailers.
“Assurant’s acquisition of The Warranty Group advances our position as a leading global provider in the vehicle protection business and aligns well with our lifestyle market growth strategy helping consumers protect their appliances, autos, mobile devices, and electronics,” said Assurant President and Chief Executive Officer Alan Colberg. “Together, we believe we can deepen our global footprint and accelerate profitable growth in key markets already on Assurant’s strategic roadmap, while realizing substantial operating synergies, generating more diversified and predictable earnings and furthering product innovation on a global scale.”
Nelson Chai, The Warranty Group’s President and Chief Executive Officer, said, “This transaction brings together two businesses with highly aligned expertise in markets across the world. We believe this combination enhances our ability to offer best-in-class products and services in addition to providing new opportunities to our clients, partners, employees and other key stakeholders.”
1 Amount is based on The Warranty Group policy of reporting a portion of its revenue net of certain costs; the presentation for the combined company will be revised to conform to Assurant’s policy of reporting revenue on a gross basis with an offset to expenses.
Eric Leathers, Partner at TPG Capital, said, “This strategic partnership is an outstanding outcome for both Assurant and The Warranty Group, positioning the combined company for continued success. Since acquiring The Warranty Group, we have supported the company’s management team as they have expanded their global service contract business by pursuing attractive pathways for growth. This combination builds on these initiatives, and we at TPG are excited by the future value creation that will stem from this.”
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