Key Takeaways
- • Risk Strategies completed a recapitalization transaction with Kelso & Company, extending a partnership that originated in 2015 when Kelso first invested in the firm as a means to acquire majority stake from prior owner Kohlberg & Company.
- • The new equity investment from Kelso will fund Risk Strategies' ongoing acquisition strategy, recruit key talent, and deepen specialty insurance practices across the national brokerage.
- • The recapitalization positions Risk Strategies for accelerated growth through strategic M&A activity while maintaining its independent specialty-focused broker model, according to leadership commentary from CEO John Mina and CFO John Vaglica.
- • Kelso & Company's continued backing reflects confidence in Risk Strategies' execution, with the firm demonstrating both organic growth and significant acquisition-driven expansion since Kelso's initial 2015 investment.
Summary
Risk Strategies, a national specialty insurance brokerage and risk management firm, announced the completion of a recapitalization transaction on March 2, 2020, involving a new equity investment from Kelso & Company. The transaction represents an extension of the existing partnership between the two firms, which began in 2015 when Kelso acquired a majority stake in Risk Strategies from predecessor owner Kohlberg & Company.
The recapitalization infuses substantial additional equity capital into Risk Strategies to support multiple strategic objectives. The capital will be deployed toward funding the firm's ongoing acquisition strategy, recruiting key professionals, and building out specialty practices across the organization. According to John Vaglica, CFO and head of M&A at Risk Strategies, the transaction enables "meaningful growth investments, including strategic acquisitions, which are a core element of our highly successful growth strategy." This signals continued emphasis on M&A as a primary lever for expansion within the specialty insurance brokerage sector.
CEO John Mina characterized the investment as positioning the company "for our next chapter of growth," underscoring the recapitalization's role as a catalyst for expansion. Chris Collins, managing director at Kelso & Company, noted that Risk Strategies "has enjoyed tremendous growth since our initial investment, driven by both significant strategic acquisition activity as well as industry-leading organic growth," indicating the firm has demonstrated dual-engine expansion capabilities through both inorganic acquisition and organic client development since Kelso's 2015 entry.
The recapitalization structure allows existing stakeholders to achieve partial liquidity while retaining equity upside, a common private equity strategy for mature portfolio companies demonstrating strong operational performance. Risk Strategies' positioning as an independent specialty-focused broker has differentiated it within a consolidating industry, creating appeal for continued private equity backing and supporting its M&A strategy to acquire smaller specialty practices and teams.
The recapitalization infuses substantial additional equity capital into Risk Strategies to support multiple strategic objectives. The capital will be deployed toward funding the firm's ongoing acquisition strategy, recruiting key professionals, and building out specialty practices across the organization. According to John Vaglica, CFO and head of M&A at Risk Strategies, the transaction enables "meaningful growth investments, including strategic acquisitions, which are a core element of our highly successful growth strategy." This signals continued emphasis on M&A as a primary lever for expansion within the specialty insurance brokerage sector.
CEO John Mina characterized the investment as positioning the company "for our next chapter of growth," underscoring the recapitalization's role as a catalyst for expansion. Chris Collins, managing director at Kelso & Company, noted that Risk Strategies "has enjoyed tremendous growth since our initial investment, driven by both significant strategic acquisition activity as well as industry-leading organic growth," indicating the firm has demonstrated dual-engine expansion capabilities through both inorganic acquisition and organic client development since Kelso's 2015 entry.
The recapitalization structure allows existing stakeholders to achieve partial liquidity while retaining equity upside, a common private equity strategy for mature portfolio companies demonstrating strong operational performance. Risk Strategies' positioning as an independent specialty-focused broker has differentiated it within a consolidating industry, creating appeal for continued private equity backing and supporting its M&A strategy to acquire smaller specialty practices and teams.
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