SageSure to Acquire GeoVera MGA, Including GeoVera’s Industry-Leading Underwriting Franchise in Residential Earthquake Risk

GeoVera Insurance Holdings, Ltd. (“GeoVera”), a leading provider of specialty property insurance, announced that it has entered into a definitive agreement to sell GeoVera in separate transactions involving GeoVera’s carrier and managing general agent (“MGA”) businesses

• As part of the transaction, the existing shareholders of GeoVera, including Flexpoint Ford, New Capital Partners, and AXA XL will exit as shareholders

SageSure Holdings, LLC (“SageSure”) to acquire GeoVera Advantage Services Inc. (“GeoVera MGA”), an existing MGA within the specialty property insurance provider GeoVera, and will assume the underwriting operations of GeoVera’s best-in-class residential earthquake franchise

• GeoVera’s experienced MGA team, including CUO Nesrin Basoz, will join SageSure, further enhancing SageSure’s catastrophe risk underwriting, claims, and product development capabilities

GeoVera and the existing insurance carrier companies will enter a merger transaction with SageSure’s carrier partner SafePort Insurance Company (“SafePort”), a property-focused insurance carrier, to form GeoVera Nova Holdings, Inc. (“GeoVera Nova”)

• Combination of insurance operating subsidiaries enhances an already strong, well-capitalized, and diversified A.M. Best-rated carrier group
• John Forney and Brian Sheekey, currently CEO and CFO, respectively, of GeoVera, will serve in the same roles for GeoVera Nova

The transaction will establish SageSure’s carrier partnership with GeoVera Nova, which will provide residential earthquake capacity in California, Oregon, and Washington, and E&S homeowners, commercial habitational, and residential wind capacity in Florida

To support the transaction, SageSure’s long-standing capital partner Ares Management Corporation will provide an expansion to its existing debt facility

GeoVera, headquartered in Fairfield, CA, is an “A” A.M. Best rated provider of specialty property insurance products focused on catastrophe-exposed properties in the earthquake wind markets, operating on both an admitted and surplus lines basis

SageSure is a managing general underwriter specializing in coastal residential and commercial property insurance

• SageSure offers more than 50 competitively priced insurance products in 14 coastal states on behalf of its carrier partners, serves more than 550,000 policyholders, and has more than $1.6bn of inforce premium

HCMA is acting as exclusive financial advisor to SageSure in its acquisition of GeoVera MGA; key roles and responsibilities include:

• Intermediating initial discussions between the two parties and assistance in developing proposed transaction structure
• Reviewing financial projections and underwriting performance of GeoVera in extensive detail
• Financial modeling, valuation analysis and due diligence on bifurcated pro forma operating structure
• Significant analytical work and insights on the GeoVera portfolio and reinsurance structure
• Rating agency consultation / oversight and extensive pro forma BCAR modeling analysis and support
• Integral role in negotiating the key commercial terms of the transaction

HCMA efforts supplemented by Howden Re’s leading reinsurance, analytics, and rating agency advisory capabilities
Transaction further solidifies HCMA as a market leader on M&A and capital markets transactions relating to MGAs

• Including M&A and bifurcated structuring advisory