JERSEY CITY, N.J., January 24, 2022 – Verisk (Nasdaq: VRSK), a leading global data analytics provider, today announced that it has entered into a definitive agreement to sell its 3E business to New Mountain Capital, a growth-oriented investment firm with more than $35 billion in assets under management, for cash consideration of up to $950 million.
Verisk's 3E business, part of its Energy and Specialty Markets division, provides intelligent compliance solutions that enable companies to manage global regulatory compliance, product stewardship risks and drive continuous improvement to support Environmental Health and Safety (EHS) initiatives. 3E provides industry-leading software and information services to 5,000 customers worldwide, including leaders in the chemical manufacturing, retail and pharmaceutical industries. Verisk acquired 3E in 2010 for $107 million and subsequently integrated the acquired Content as a Service (CaaS) into the 3E business in 2019.
“The sale of 3E is an important step in Verisk's ongoing comprehensive portfolio review to best position the company for continued strong growth,” said Scott Stevenson, Verisk's chairman, president and CEO. “These efforts are consistent with our focus on identifying opportunities that will create the most value for the company and our shareholders and generating high returns on invested capital. Today's announcement marks a great outcome for Verisk, our shareholders and the talented 3E team.”
Lee Shabel, CFO and group president at Verisk, said, “New Mountain Capital's strategy of backing best-in-class companies is a strong endorsement of the critical role 3E plays in the success of its clients across nearly every industry around the world. We are confident that under New Mountain Capital, 3E will be well-positioned to continue delivering critical services and value to its clients.”
Pete Masucci, Managing Director at New Mountain Capital, said, “3E has a long-standing commitment to innovation that has resulted in the development of differentiated, mission-critical software, data and services for its clients. We believe 3E is well positioned to benefit from favorable macro trends as companies navigate ever-evolving global regulations, provide safer working environments for their employees and focus on achieving sustainability goals.”
Gandalf Bedi, Director at New Mountain Capital, added: “3E impressed us as a uniquely attractive platform in both the EHS and information services sectors, which New Mountain is extremely familiar with. We are excited to partner with the team to support 3E's next stage of growth and look forward to investing in continued product innovation, significant market expansion and strategic acquisitions to further expand 3E's value proposition to customers and partners.”
The total purchase price is subject to customary adjustments, including for the working capital and liabilities of the business at closing. The purchase price consists of $630 million in cash consideration payable at closing, up to $50 million in earn-out payments based on New Mountain's performance in 2023 and 2024, and up to an additional $270 million in deferred payments based on New Mountain's future investment returns, for a total cash consideration of up to $950 million. Verisk intends to return after-tax proceeds to shareholders through share repurchases.
The transaction is subject to customary closing conditions, including regulatory approvals.
BofA Securities is acting as financial advisor and Davis Polk & Wardwell is acting as legal advisor to Verisk in connection with the transaction. Simpson Thacher & Bartlett is acting as legal advisor to New Mountain.
About Verisk
Verisk (Nasdaq:VRSK) provides predictive analytics and decision support solutions to clients in the insurance, energy, specialty markets and financial services industries. More than 70% of FORTUNE 100 companies rely on the company's advanced technology to manage risk, make better decisions and improve operational efficiency. The company's analytics solutions address underwriting and claims, fraud, regulatory compliance, natural resources, catastrophes, economic forecasting, geopolitical risk and environmental, social and governance (ESG) issues. Now in its 50th year, the company continues to make the world better, safer and stronger and foster an inclusive and diverse culture where all team members feel like they belong. With more than 100 offices in approximately 35 countries, Verisk continues to be certified as a Great Place to Work. For more information, please visit Verisk.com, LinkedIn, or LinkedIn. twitterFacebook, YouTube, etc.
About New Mountain Capital
New Mountain Capital is a New York-based investment firm that emphasizes building and growing businesses over debt in pursuit of long-term capital appreciation. The firm currently manages private equity, credit and net lease real estate funds with over $35 billion in assets under management. New Mountain seeks out companies that it believes to be the highest quality leaders in select “defensive growth” industry sectors and works closely with management teams to increase the value of these companies. Additional information about New Mountain Capital can be found at www.newmountaincapital.com.
Investor Relations
Stacey Brodber
Head of Investor Relations
Velisk
201-469-4327
stacey.brodbar@verisk.com
media
Albert Canal
Velisk
201-469-2618
alberto.canal@verisk.com
Dana Gorman, Matthew Butler, Abernathy McGregor
New Mountain Capital
212-371-5999
dtg@abmac.com or msb@abmac.com
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