Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
The family office of technology billionaire Michael Dell is nearing a take-private deal for The Baldwin Group, an insurance brokerage firm with a $4.1bn market value.
Dell’s DFO Management is in advanced talks with Baldwin over a deal, which is expected to value the company at a premium, according to people familiar with the matter. A deal could be announced as soon as next week, provided it did not hit any last-minute snags, the people said.
Baldwin specialises in commercial insurance brokerage, advising midsized and large companies shopping for insurance policies for everything from cyber security to employee benefits to real estate.
A potential take-private deal for Baldwin comes on the heels of Aon buying KKR-backed brokerage firm USI Insurance at the end of last month for $17bn, in a sale which is set to generate the New York-based private equity giant $3.3bn.
A takeover of Baldwin would be a rare full-blown leveraged buyout undertaken by DFO, one of the world’s largest family offices which manages tech billionaire Dell’s money. DFO’s predecessor, MSD Capital, played a major role in the $24.9bn leveraged buyout of Dell Technologies alongside Silver Lake Capital Management in 2013.
DFO was recently a minority equity investor in the Silver Lake-led consortiums buying social media app TikTok’s US business and taking entertainment giant Endeavor Holdings Group private. DFO also invests in public equities.
Tampa, Florida-based Baldwin traces its roots back to 2006. Its co-founder Lowry Baldwin is still among the group’s largest shareholders and serves as chair of the board.
The historically fragmented industry of insurance brokerage is in the midst of a wave of consolidation as companies are seeking scale and greater market share. Shares in Baldwin are up by nearly 25 per cent since the start of the year off the back of speculation about a go-private deal.
DFO and Baldwin did not immediately respond to requests for comment.
