EQT Private Equity and Vitruvian Partners announce significant investment in CFC

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EQT Private Equity has agreed to make a significant investment together with Vitruvian Partners in CFC, a leading technology-driven global insurance business CFC is a specialist insurance provider, pioneer in emerging risk and market leader in cyber, serving more than 100,000 businesses in over 90 countries.

EQT Private Equity and Vitruvian Partners will support CFC’s investments in innovative and market-leading technology and in continuing to deliver best-in-class products and services to its customers

EQT is pleased to announce that the EQT IX fund (“EQT Private Equity”) has agreed to invest in CFC (the “Company”) alongside management and Vitruvian Partners (“Vitruvian”).

Founded in 1999, CFC was one of the pioneers in the cyber insurance market. Today, it is a technology-driven business that has established itself as a global leader in cyber and provider of cover for a diverse range of emerging risks that sit at the intersection of technology and business. CFC writes 50 products across 20 different classes of specialist insurance focused primarily on SME businesses.

The company has significantly grown its employee count over the past three years and has an established global footprint with more than 500 staff located across the UK, US, Europe and Australia. Earlier in the year CFC also launched its own Lloyd’s Syndicate.

CFC’s continued growth trajectory underlines the depth and quality of its business model: it has an annual premium run rate in excess of GBP 750 million (USD 1 billion) and delivered an organic EBITDA CAGR of 35 percent over the last five years.

Upon completion, following regulatory approval, CFC will nearly double its employee shareholders from 175 to over 300. Employees will remain the largest shareholder in CFC.

Dave Walsh, CFC founder and Group CEO, said“We’re delighted to welcome EQT as an investor alongside Vitruvian. Both EQT and Vitruvian’s focus on high-growth technology companies and commitment to creating a positive impact through their portfolios is a natural fit with CFC and our ethos as an independent, employee-owned business. EQT’s investment, and Vitruvian’s reinvestment, is testament to CFC’s track record of delivering strong, profitable growth underpinned by the expertise of our people and our history of market-leading technology innovation.

“As we look ahead, we see a risk landscape that is rapidly shifting, with ever-expanding cyber threats, new insurance challenges presented by intangible assets and evolving risks in rapid growth sectors. CFC has a key role to play in helping our growing customer base address these challenges, while the pioneering technology we’ve built over the last two decades is enabling us to deliver at increasing scale. We look forward to partnering with EQT and thank Vitruvian for their continued partnership. It has never been a more exciting time to be at CFC.”

Robert Maclean, Partner within EQT Private Equity’s Advisory Team, commented, “CFC is a truly innovative insurance business with technology at its core and a track record of growth and profitability which surpasses even the most mature Fintech businesses we’ve seen. The accelerating pace of investments in its core platform aligns perfectly with EQT’s approach of future proofing companies.”

Joe O’ Mara, Partner at Vitruvian, commented, “As longstanding partners and investors in CFC, we couldn’t be more enthusiastic about the road ahead. We’ve witnessed first-hand what a remarkable business CFC is – a tribute to the leadership team, the culture they’ve created and the commitment to excellence and innovation that has kept CFC at the forefront of the insurance market.”

Sofia Ahuja, Managing Director within EQT Private Equity’s Advisory Team, added, “CFC’s unrivalled reputation in cyber insurance and focus on emerging risk areas ensures that it is well-placed to capture the significant growth expected in the classes it writes. We’re delighted to invest alongside Vitruvian at this exciting stage in CFC’s journey.”

Stephen Byrne, Partner at Vitruvian, added, “We would like to thank the whole CFC team for a great partnership over the last four years and we are excited to be able to continue to support their ambitions for the future.”

EQT was advised by Morgan Stanley, Kirkland & Ellis, KPMG and Bain & Company on the transaction.

The transaction is subject to customary conditions and approvals. With this transaction, EQT IX is expected to be 70-75 percent invested (including closed and/or signed investments, announced public offers, if applicable, and less any expected syndication).

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