(Image source: Bamboo homepage.)
White Mountains Insurance Group, Ltd. (Hamilton, Bermuda) has announced that it has entered into an agreement to acquire a majority stake in Bamboo Ide8 Insurance Services, LLC (Midvale, Utah), an MGA focused on the California homeowners insurance market. White Mountains expects to invest approximately $285 million, including primary capital to support Bamboo’s growth, and to acquire approximately 70 percent of Bamboo basic shares outstanding.
Bamboo was launched in 2018 by insurance industry veteran John Chu. The company provides homeowners’ insurance for over 100,000 California policyholders, using its technology-enabled underwriting platform to select and manage risk. White Mountains reports that Bamboo has grown profitably and rapidly in the challenging California market, and is now poised to expand into other states. Chu and the current Bamboo management team will continue to lead the business through its next phase and will retain a significant equity stake, a White Mountains statement on the investment says.
“We are pleased to make this investment alongside John and the Bamboo management team,” comments Chris Delehanty, Head of M&A, White Mountains Insurance Group. “Bamboo is delivering a much-needed insurance alternative to homeowners in California. Bamboo has strong momentum, and we look forward to supporting its continued growth.”
New and Exciting Chapter
“This transaction marks a new and exciting chapter for Bamboo,” comments John Chu, Founder and CEO, Bamboo. “We are fortunate to have found a like-minded capital partner who shares our vision and has a strong track record of successful insurance partnerships.”
White Mountains says that the transaction is expected to close in the first quarter of 2024. The closing is subject to regulatory approvals and other customary closing conditions. The closing is not subject to a financing condition. The exact ownership to be acquired by White Mountains, and the resulting amount that will be invested, will be determined based on Bamboo unitholder elections made prior to closing.
Howden Tiger Capital Markets & Advisory acted as financial advisor to White Mountains, while Cravath, Swaine & Moore LLP provided legal advice. Evercore Group, L.L.C. acted as financial advisor to Bamboo and selling equityholders, while Willkie Farr & Gallagher LLP provided legal advice.