William Blair Advises CUNA Mutual Group

Thursday, February 6, 2014

William Blair & Company acted as a financial advisor to CUNA Mutual Group regarding the sale of its outstanding interest in CMG Mortgage Insurance Company (CMG MI), a joint venture between PMI Mortgage Insurance Co. and CUNA Mutual Group. Under the business arrangement, Arch Capital Group will acquire all outstanding equity interests in CMG MI from PMI and CUNA Mutual Group. Through the business combination, CMG MI will continue to provide the customer-focused products and services that have made CMG MI the longstanding market leader in meeting the mortgage insurance needs of credit unions.

This transaction marks William Blair’s ninth insurance-related transaction over the past 12 months and highlights the investment banking team’s strong momentum in the sector.

Transaction Highlights

  • Highly strategic transaction: The acquisition of CMG MI allows Arch to broaden its existing mortgage insurance and reinsurance capabilities. The deal is highly strategic for Arch, providing an immediate 40%+ market share in the private mortgage insurance credit union segment, a best-in-class reputation for servicing and product innovation, and expanded distribution and access to new vertical markets. Arch will purchase PMI’s information technology platform and systems and, as a result, CMG MI is expected to enjoy uninterrupted delivery of technology support for its operations. CUNA Mutual Group mortgage insurance sales staff will continue to serve credit union customers on behalf of CMG MI.
     
  • Fit with William Blair’s insurance expertise: CUNA Mutual Group recognized William Blair’s extensive knowledge and experience within the insurance sector, as well as the firm’s strong relationships with likely strategic acquirers focused on this area.
     
  • Proven results: CUNA Mutual Group and William Blair developed a longstanding relationship built on trust and industry expertise. CUNA Mutual Group Life viewed William Blair as a trusted partner that has delivered exceptional results for other companies in the insurance sector. CUNA Mutual Group valued William Blair’s ability to effectively articulate CMG MI’s competitive differentiation to potential acquirers. William Blair worked in parallel with Lazard during the sale of CMG MI to create the offering memorandum, coordinate the due diligence process, and negotiate key terms of the purchase agreement.

About the Companies

CMG MI is a leading provider of private mortgage insurance products and services for the credit union industry. The company was founded in 1994 as a joint venture between CUNA Mutual Group and PMI Mortgage Insurance Co.

Arch Capital Group Ltd. (NasdaqGS:ACGL) provides insurance and reinsurance solutions worldwide through operations in Bermuda, the United States, Europe, and Canada, with a focus on specialty lines. Arch is a public limited liability company with approximately $6 billion in capital.

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