Hub International, an insurance brokerage and financial services firm based in Chicago, has secured an agreement for a minority stake of $1.6 billion from funds advised by T. Rowe Price Investment Management, Alpha Wave Global and Singaporean state-owned investment firm Temasek, among others.
According to the registered investment advisor, the stake values Hub at $29 billion, reflecting annual revenue of $4.8 billion in 2024. The funding, which is expected to close at the end of May, will go toward acquisitions, debt repayments and keeping excess cash on Hub’s books, according to an announcement.
The investors will get a stake in a firm that has grown substantially over the past decade, partly through acquisitions across individual wealth management and institutional retirement plan practices. The firm currently has about 19,000 employees throughout North America and client assets of $178 billion.
According to the announcement, prior investors are, for now, keeping their previous positions after the transaction.
Hellman & Friedman, which took a stake in Hub in 2013, will retain its controlling interest. Private equity firm Altas Partners took a minority stake in Hub in 2018, and PE firm Leonard Green & Partners, which made a minority investment in 2023, will continue as shareholders with seats on Hub’s board of directors. The company’s management team, led by Chairman and CEO Marc Cohen, will also keep a “significant equity position,” according to the firm.
Hub makes regular liquidity available to existing shareholders through a Liquid Private Placement program. Through that setup, institutional shareholders can cash out in connection with transactions such as the T. Rowe-led minority investment. However, Hub said it does not expect to use the new investments to fund redemptions from existing equity holders.
“Lack of selling appetite allowed the investment proceeds to provide primary capital for growth initiatives and other general corporate purposes, such as acquisitions, debt repayments and maintaining excess cash on Hub’s balance sheet,” the firm wrote in its announcement. “The recurring nature of these investments reflects continued investor confidence in Hub’s scale, profitability, organic revenue growth and maintained focus on middle and upper middle market clients.”
Morgan Stanley Smith Barney and Goldman Sachs served as Hub’s financial advisors in the transaction, and Simpson Thacher & Bartlett provided legal counsel.
T. Rowe Price Investment Management has investments of about $207 billion in various companies, including insurers and corporations.