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Sovereign exits commercial insurance brokerage Arachas for 5.5x money


Sovereign Capital Partners, the private equity Buy & Build specialist, is pleased to announce the realisation of its investment in Arachas Corporate Brokers (“Arachas”), a leading commercial insurance brokerage in Ireland to certain funds controlled and managed by Madison Dearborn Partners (“MDP”) and HPS Investment Partners (“HPS”). The exit, which follows three years of Sovereign’s partnership with Arachas, delivers a 5.5x money return to investors.

Sovereign originally backed the MBO of Arachas in early 2017. During the period of Sovereign’s investment Arachas made four acquisitions: Capital Cover Group, Kidd Insurances, Covercentre and most recently Murray & Spelman. The acquisitions brought substantial additional scale to the Group, further developing its service offering and distribution channels, expanding its geographical footprint and consolidating its position as the leading SME focused commercial lines insurance broker in Ireland. Today Arachas employs over 240 staff across its offices in Dublin, Cork, Kildare and Waterford.

Alex Hay, Partner, Sovereign commented: “We are delighted to have partnered this highly respected management team to support the transformational growth of Arachas in the Irish market. The business has achieved exceptional organic and strategic growth in the last three years whilst remaining focused on delivering a consistent and first class customer experience. We have hugely enjoyed working with founder Donal Cronin, Chairman Gareth Brady, CEO Conor Brennan and CFO John McCarthy over this time and we wish Arachas every continued success under its new ownership.”

Conor Brennan, CEO of Arachas said: “This has been a fantastic period of expansion and development for the Group. Sovereign has been a highly supportive investor providing both financial and strategic capability. Together we made a series of high quality acquisitions and delivered strong organic growth supported by significant investment into the company’s IT systems and data analytics capability. We are well positioned to continue to flourish in what is an exciting insurance market.”

The closing of the transaction only remains subject to the required regulatory approvals..