Friday, August 30, 2019
Three Hills Capital Partners invests in Trak Global GroupInvestment Activity
Three Hills Capital Partners (“THCP”) is pleased to announce its investment in Trak Global Group (“TGG” or the “Company”), one of the world’s leading telematics technology companies.
Operating in five countries, Trak Global Group (TGG) is one of the world’s largest telematics companies, gathering and interpreting data from connected devices to help organisations manage driver and vehicle risk. The business has long-standing partnerships with global insurers, leading motor manufacturers, corporate fleets and daily rental companies and is the UK’s largest insurance telematics business. In addition to its partnerships with major insurers, the business has over 130 patents associated with connected car services and has pioneered the use of telematics technology for Road Usage Charging in the US, with successful pilots across four states. In late 2018, TGG acquired IMS, the 3rd largest insurance telematics business in North America.
Carrot Insurance, also part of TGG, is a UK-based, award-winning telematics insurance broker specialising in novice drivers. Carrot has received the Prince Michael International Road Safety Award for its work in reducing young driver accident frequency, and in 2015, it launched Better Driver, an app-based product representing the UK’s first mass-market usage-based insurance product.
The combined Group business has long-standing partnerships with global insurers, mobility operators and motor manufacturers, gathering and interpreting data from connected devices to help organisations manage driver and vehicle risk. Its customers include RSA, Volkswagen Financial Services, Nationwide Insurance (USA), Allianz, Europcar and Zipcar. The Group employs over 250 people across four international offices.
THCP is to acquire a significant minority stake in the business. This capital investment of over £40m will accelerate the development of new products and services via IMS’ DriveSync 6 platform, benefitting the Group’s clients across insurance, mobility, automotive OEMs and governments, as well as supporting growth in the N. American territory and further acquisition activity.
TGG Group CEO Nick Corrie said the partnership creates a capital structure that will “enable us to more rapidly execute our ambitious growth plans, both organic and by acquisition, to become the global leader providing connected, data-driven technology solutions for the insurance and shared mobility markets.”
Corrie stated that the investment from THCP will accelerate the deployment of the next generation of IMS’s cloud-based, device-agnostic single telematics platform, DriveSync6, and enable the deployment of new solutions and services for customers. “We will also be continuing to invest in innovation, such as our pioneering work in Road Usage Charging in the US and developing IP around connected car services that our customers in UBI and mobility will jointly benefit from, particularly as we continue to see the convergence of these two markets.”
He added: “This is a real milestone for TGG, as we celebrate a decade in business. In THCP we’ve found an investment partner that believes in our vision, is very well-aligned culturally and possesses the expertise to help steer the business through what will be an exciting phase of growth. THCP’s solution was unique in the market and matches our ambitions for the future. Worldwide, TGG already connects half a million vehicles and we are aiming to increase this figure exponentially over the coming years.”
Joe Jefferies, UK coverage at THCP, who will join TGG’s Board, said: “Trak Global is our first investment in the IoT and telematics space, and during our detailed diligence into the sector it quickly became clear that TGG was the stand-out performer. The combination of management team strength and vision, as well as the company’s relentless focus on forming true partnerships with their customers, made for a compelling investment case. We are delighted to be Trak Global’s partners in what we expect to be a period of exceptional and transformative growth. It is another example of Three Hills’ commitment to backing ambitious founders and management teams who are looking for an alternative solution to traditional private equity structures.”
TGG was advised by PwC (Corporate Finance, Financial, Commercial and Tax DD) and DWF (Legals)
THCP was advised by KPMG (Corporate Finance, Financial, Commercial), EY (Tax), CMS (Legals) and Anagram (Technology)