Chief executive confirms group is looking to branch out into construction and property.
Hyperion Insurance Group is set to target brokers and underwriting agencies across the UK regions with an acquisition purse funded by its private equity backer, 3i.
Hyperion, holding group of Howden Insurance Brokers and underwriting agencies CFC and Dual, has recently opened a number of overseas offices, but is now looking to the UK regions in a bid to boost its retail operation.
Traditionally seen as a professional indemnity specialist, Hyperion is looking to branch out into new lines of business, such as construction and property.
Chief executive David Howden said the group was on the lookout for small to medium sized broking and underwriting businesses with a specialised book. He added that the group would be willing to back entrepreunial teams looking to set up on their own.
Howden said: “We have built an international network with insurance broking centre in strong regional broking offices, for example in the Middle East and Asia, and there has to be a stronger retail presence in our home territory of the UK. Currently our retail business is London-centric and that could well be complemented by a stronger presence and broader lines of business.
“From an underwriting point of view, many of the underwriting agencies we deal with have now got regional offices. At the moment Dual is purely London based, there’s a whole raft of products and clients that we would like to attract, and they won’t come knocking on our door if we just rest here on our laurels in London.”
3i Growth Capital took a £50m equity investment in the group earlier this year. According to Howden, some £25m of that would be available for UK acquisitions, a figure that could be leveraged by the group’s loan facility with HSBC.
3i also has a £45m stake in consolidator Jelf, though this is through its 3i Quoted Private Equity arm.
Howden said the two brokers’ ambitions would not conflict, because he was looking to buy small, specialised brokers, while Jelf focused on larger and more generalised businesses.
Hyperion enjoyed a 15% growth in turnover to £39.2m in 2007, it reported in June, although its operating profit dropped as a result of exceptional expenses.
The group saw its operating profit drop from £5.9m to £5m, as a result of £1.5m of extraordinary expenses including staff incentives. Brokerage and commissions in the UK also dropped, from £14m to £12.6m.