By Isha Marathe

Feb 24 - (The Insurer) - Carlyle-owned MGA platform NSM Insurance Group has signed a definitive agreement to sell its U.S. commercial insurance division to growth investment firm New Mountain Capital.

The financial terms of the deal were not disclosed. The transaction is expected to close in 45 days, subject to regulatory approvals and other customary closing conditions.

New Mountain, an investor in Amwins, will acquire NSM's portfolio of 15 insurance programs across property and casualty, accident and health, and reinsurance, along with its retail agency, NSM Insurance Brokers.

Under the terms of the deal, these programs will form a new independent business entity, which will continue to be marketed as NSM until a new brand is established.

"We are extremely proud of the unique portfolio of programs we have built over the last 35 years that provide a profitable and diversified position in today's competitive marketplace," said Geof McKernan, CEO of NSM Insurance Group.

"New Mountain has an impressive track record and we have the utmost confidence in their expertise, integrity, and commitment to drive NSM forward."

Geof McKernan and Bill McKernan will join the board of directors upon closing of the acquisition to ensure continuity and a smooth transition. Aaron Miller, chief commercial lines officer at NSM, will become the CEO of the new entity backed by New Mountain.

"I look forward to partnering with the New Mountain team and working with my B2B colleagues to propel us toward unprecedented success," Miller said.

In May 2022, Carlyle agreed to acquire specialty MGA platform NSM from White Mountains in a transaction valued at $1.78 billion, or 22.5x its then reported pro forma adjusted trailing 12-month Ebitda.

“Together, we achieved strong organic growth, completed six strategic acquisitions, added high quality talent, and built a specialised, diversified, and scaled insurance distribution platform. We could not be happier with this outcome and are excited to partner with Carlyle as we embark on NSM’s next stage of growth," McKernan said at the time.

Since the company's founding in 1990, NSM has grown and evolved into a global specialty insurance provider with more than $2 billion in premiums across 30 niche insurance programs.

Houlihan Lokey acted as exclusive financial adviser to Carlyle and NSM. Wachtell, Lipton, Rosen & Katz acted as legal counsel to Carlyle and NSM. Polsinelli acted as legal counsel to NSM. Ardea Partners acted as exclusive financial adviser, and Simpson Thacher & Bartlett served as legal counsel to New Mountain.