Thursday, January 9, 2014

Carlyle Insurance Brokerage Goes Bi-Coastal

Atlanta Business Chronicle reported:

Private equity powerhouse The Carlyle Group is building a national insurance brokerage firm. And, it's leaning on a 40-year-old Atlanta insurance broker to build that business.

On Jan. 6, The McCart Group of Atlanta was acquired by San Francisco, Calif.-based insurance broker Edgewood Partners Insurance Center (EPIC) for an undisclosed amount.

The Carlyle Group subsequently invested in the combined entity.

The McCart Group, which employs about 115 in Atlanta, provides risk management, property and casualty and employee benefit and personal risk management products to large employers.
McCart will add to EPIC's footprint, which Carlyle plans to grow.  Insurance Journal reported:

EPIC’s strategic plan calls for a dramatic increase in its current $100 million in revenues to $250 million by 2018 and further expansion across the country, according to Derek Thomas, EPIC chief strategy officer.
The McCart Group will add approximately $20 million in revenue to EPIC in 2014.
How many Carlyle affiliates will seek bids from the combined EPIC/McCart in 2014?  Carlyle had BankUnited for affiliates to use until they flipped their publicly subsidized investment for massive gains.  Now they have an insurance broker.  

Watch how employer sponsored health insurance changes nationally for employees and retirees.  How might EPIC/McCart advance the shift to defined contribution health care from employers?  How many retirees will be left out in the cold by large employers via the dump to private insurance exchanges? 

Carlyle reads the tea leaves and invests accordingly.  For Carlyle to profit handsomely seismic shifts are in order.  They like disequilibrium.