White Mountains Acquisition of a Majority Stake in Bamboo

Transaction Overview

On 10/20/2023, White Mountains Insurance Group, Ltd. (“White Mountains”) announced an acquisition of a majority stake in Bamboo Ide8 Insurance Services, LLC (“Bamboo”)

  • White Mountains expects to invest approximately $285 million, including primary capital to support Bamboo’s growth, and to acquire approximately 70% of Bamboo basic shares outstanding

Bamboo is a capital-light, tech- and data-enabled insurance distribution platform providing insurance offerings to the residential property market in California

  • Founded in 2018 by seasoned insurance executive John Chu
  • Operates primarily through its full-service MGA business, where the company manages all aspects of the placement process on behalf of its fronting and (re)insurance partners, including product development, marketing, underwriting, policy issuance, and claims oversight, and earns commissions based on the volume and profitability of the insurance that it places
  • Provides homeowners’ insurance for 100k+ California policyholders, using its tech-enabled underwriting platform to select and manage risk
  • Has grown profitably and rapidly in the challenging California market, and is now poised to expand into other states

White Mountains is a publicly-traded Bermuda-domiciled financial services holding company

  • White Mountains has a superior, long-term track record with a focus on long-term value creation
    • ~$4bn market cap; ~$5bn in total capital
    • Select active investments include Ark, HG Global / BAM, Kudu Investment Management, and PassportCard / DavidShield
  • The firm is traded on the New York Stock Exchange under the symbol WTM and on the Bermuda Stock Exchange under the symbol WTM.BH

Howden Tiger Capital Markets & Advisory Role

HTCMA is acting as as financial advisor to White Mountains; key roles and responsibilities included:

  • Providing perspectives on Bamboo’s business, competitive position, and valuation
  • Leveraging the resources and expertise of the broader Howden Tiger organization to provide:
    • Detailed review of market conditions in the California homeowners market including the potential impact of ongoing legislative action
    • Analysis of the terms and pricing of Bamboo’s existing capacity providers
    • Assessment of go-forward capacity strategy to support the continued growth of the business
  • Providing objective advice and acting as a confidant to White Mountains