Platinum Equity sells Broadspire Services to Crawford & Company
8/21/2006
ATLANTA, GA and BEVERLY HILLS, CA (August 21, 2006) – Crawford & Company and Platinum Equity announced today that they have entered into a definitive agreement under which Crawford will acquire Platinum’s portfolio company Broadspire Services, Inc., a leading third-party administrator offering a comprehensive integrated platform of casualty claim and medical management services.
Broadspire, a privately-held corporation, will be acquired by Crawford for total consideration of $150 million and the acquisition is anticipated to more than double Crawford’s revenue from self-insured clients. The transaction, which is subject to normal closing conditions, is expected to be completed during the fourth quarter 2006.
“We are excited about this acquisition and believe that it not only further strengthens our position in the marketplace, it also illustrates that we are fully committed to serving our clients’ and brokers’ needs,” said Tom Crawford, president and CEO of Crawford & Company. “Broadspire’s reputation, experience, and resources, coupled with our revolutionary service model and wide array of specialized support services, provide clients with a distinct advantage clearly focused on driving down costs.”
Jim Levitas, senior vice president for mergers and acquisitions at Platinum Equity, said that Crawford & Company is an ideal strategic acquirer to continue the growth and development of Broadspire, which Platinum established as a stand-alone company after acquiring the business in 2003 from Kemper Insurance Companies.
“We have invested a great deal in building Broadspire into one of the industry’s premier providers of integrated claims and medical management services,” Mr. Levitas said. “We are proud of the company’s strong capabilities and track record, and have a great deal of confidence that Crawford will continue building on Broadspire’s success.”
Dennis Replogle, president and CEO of Broadspire, said the combination of Broadspire and Crawford & Company would enhance the capabilities of each.
“This transaction is a huge win for both companies,” Mr. Replogle said. “In particular, clients will see greater value and performance as the best components of both organizations are combined to provide a dynamic suite of enhanced products and services.”
The acquisition of Broadspire supports Crawford’s mission of becoming the leader and third-party administrator of choice in all segments of the market for casualty claims program administration. Casualty claims administration encompasses workers’ compensation, and auto and general liability exposures for the insured and self-insured marketplace. Based on 2005 revenue1, the combined Crawford and Broadspire organization will rank third in revenue from claims handled for this market segment.
Crawford & Company intends to retain the Broadspire name, rebranding Crawford Integrated Services, its risk and heathcare management business unit.
“Keeping the Broadspire name fits in with the Crawford & Company strategy of providing an independent, clearly recognizable identity for each business unit within the Company,” said Bob Kulbick, president of Crawford Integrated Services. “I am also delighted that Dennis Replogle has agreed to be a part of the new company.”
StoneRidge Advisors, LLC acted as financial advisor to Platinum Equity.