Two private investment firms have agreed to acquire Vault Holdings, a St. Petersburg-based insurance company that caters to the affluent.
Cornell Capital LLC and Hudson Structured Capital Management Ltd. will buy Vault in a deal expected to close in the first quarter of 2021, a news release said. Financial terms were not disclosed.
Vault was created in 2017 to take advantage of market opportunities within the high-net worth homeowners segment. The company offers customizable services and policies to insure high-value homes and cars, as well as collections of art, jewelry, wine, antiques and memorabilia. Its downtown St. Petersburg office is the headquarters and nerve center for underwriting, operations and claims at Vault.
“In less than three years, Vault has progressed from a dynamic startup to a fast-growing disruptor,” said Henry Cornell, founder and senior partner of Cornell Capital.
The market demand for premium personal insurance is growing rapidly, said Scott Carmilani, co-founder of Vault and chairman of the company’s board.
“There are more than 12 million U.S. households in our target market, up from 6.8 million in 2009, and nearly 80 percent of them do not currently utilize the services of a high-net-worth insurance specialist, presenting Vault with a large addressable market,” Carmilani said.
Carmilani is former chairman and CEO of Allied World Assurance Company Holdings Ltd., the current majority owner. Allied World will retain an indirect minority interest in Vault after the deal closes. Carmilani will continue to serve as chairman. Charles Williamon, Vault co-founder and CEO, and his leadership team will continue to operate the business.
“By leveraging Cornell Capital and HSCM’s deep industry expertise, operational capabilities, and capital resources, Vault is poised to unlock additional growth opportunities,” Williamson said.
Vault’s initial operations were in Florida but the company has since expanded into several other states including South Carolina and New Jersey, credit agency AM Best wrote in a November 2019 report. Total assets increased from $50 million in 2017 to more than $76 million, AM Best said.
“Moving forward, Vault has the potential to become an even stronger, more nimble competitor, capable of reshaping the sector, attracting and retaining top talent, and achieving market leadership in high-net worth personal insurance,” said Cornell, the former vice chairman of Goldman Sachs’ Merchant Banking Division. He founded Cornell Capital, a private investment firm, in 2013.
HSCM, an asset manager focused on alternative investments, was an initial investor in Vault.
“We are eager to build on the impressive growth and momentum that we have achieved together over the past three years,” said Michael Millette, founder and managing partner of HSCM.
Vault expects to keep its “A-” (strong) rating from AM Best when the deal closes.
“The ratings reflect Vault’s balance sheet strength, which AM Best categorizes as strong, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management,” a November 2019 report from AM Best said. The credit agency had a stable outlook for Vault.
TigerRisk Capital Markets & Advisory was financial advisor to Cornell Capital, HSCM and Vault in connection with this transaction. Debevoise & Plimpton was legal advisor to Cornell Capital and HSCM.