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September 15, 2020

Novacap acquires majority stake in specialty insurance MGU Optiom

By Verdict Staff

Canada-based private equity firm Novacap has purchased a majority interest in specialty insurance managing general underwriter (MGU) Optiom.

The financial details of the deal were not disclosed.

Optiom offers specialty vehicle replacement insurance and guarantee programmes across Canada, with Lloyd’s Coverholder status.  It is said to offer a range of coverage for both total losses and partial losses to ensure the protection of the asset of its customers.

Novacap will support the further growth and expansion of Optiom across the markets in Canada.

NovacapFinancial Services managing partnerMarcel Larochelle said: “We’re thrilled to welcome Optiom into our portfolio of companies. We are impressed with the quality of the Optiom business and their track record of profitable growth.

“Optiom is the first investment of the Novacap Financial Services I fund since its first closing in November 2019. We are the first private equity firm in Canada to launch a fund dedicated to financial services businesses.”

Novacap senior partner Rajiv Bahl added: “We are convinced that the combination of their expertise with our focus on operational excellence will drive Optiom through its next phase of growth. We are all very excited to enter this partnership with the management team.”

Commenting on the development, OptiomCEO Robert Jack said: “For more than 16 years, Optiom has developed superior equity protection and exceptional service, thanks to the quality of our people, our products, and our insurers.

“We are proud to unite with a partner of Novacap’s calibre to drive Optiom into its next stage of expansion.”

UBS Securities Canada acted as exclusive financial advisor to Optiom and Borden Ladner Gervais acted as legal advisors, while McCarthy Tétraultprovided legal advice to Novacap on the deal.

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