BP Marsh, the UK-based specialist investor, has divested its approximately 20% stake in Sterling Insurance to ATC Insurance Solutions, an Australian underwriting agency in which BP Marsh already has a 25% holding. 

The transaction saw ATC acquire 100% of Sterling’s issued share capital for a total consideration of A$33.2m, through a combination of cash and equity.  

BP Marsh’s portion of the deal, corresponding to its 20% interest in Sterling, will be settled via equity in ATC valued at around A$6.5m.  

This increases BP Marsh’s stake in ATC from 25% to 27%. 

BP Marsh initially invested approximately £1.9m in Sterling in 2013.  

The investment generated an internal rate of return of 8.8% over a 12-year period. The firm expects further value growth through its increased holding in ATC. 

As part of the transaction, Dan Topping has stepped down from his position as nominee director on Sterling’s board, while retaining his board role at ATC. 

BP Marsh stated that the transaction is aimed at facilitating a combination of its two investee companies, allowing Sterling’s senior management to roll equity into ATC and providing liquidity to long-term shareholders of Sterling. 

ATC chairman and managing director Chris Anderson stated: “Sterling is highly respected within its sector, with a strong focus on niche, hard-to-place and complex risks. We are thrilled to welcome Sterling to the ATC family and look forward to working closely with their team as we continue to grow together.” 

Sterling Chairman Tony Parington said: “We are excited to be joining forces with ATC and look forward to contributing to the success of the combined business. 

“Our partnership with BP Marsh since 2013 has been productive, and we are pleased that this relationship will continue as part of ATC.”