Broadspire News

Platinum Equity, LLC purchases Kemper Services

The Kemper Services Insurance Companies today announced the sale of its service platform, Kemper Services, to Platinum Equity, LLC. The acquisition was closed today following approval by the Illinois Department of Insurance. Financial terms were not disclosed.

As part of the transaction, Platinum Equity acquires Kemper Services's property and casualty claim, medical and disability management services and risk and safety consulting business. Kemper Services provides claims management services; disability, integrated return to work and absentee management programs; medical management services; and risk and safety consulting services.

"We're very pleased with this transaction and believe it will be beneficial to all of our constituents - policyholders, employees and others," said Kemper Services Insurance Companies Executive Vice President and Chief Financial Officer William A. Hickey. "Kemper Services will continue to provide claim service for our insurance run-off business. That stability of claim handling will be an important part of our successful run-off plan."

Johnny O. Lopez, executive vice president for mergers and acquisitions at Platinum Equity, said the Kemper Services business represents an important addition to Platinum's portfolio of mission-critical services and solutions businesses.

"This is a great opportunity for Platinum to acquire, operate and grow another market-leading portfolio company," Mr. Lopez said. "Kemper Services is well known in the insurance and risk management
industry as a best-in-class service provider, and we are confident that this business will thrive as an independent, standalone company."

Platinum Equity announced that Patricia A. Drago, president of Kemper Services, will continue to run the business as president and chief executive officer. Ms. Drago joined Kemper Services in 2000 to lead the company's Client Services Group, which included Claims, Kemper Services, Litigation, Kemper Services loss control and Premium Audit. An attorney and one of Business Insurance Magazine's Top 100 Insurance Women, she previously was president of Crum & Forster Insurance.

Ms. Drago said that under Platinum ownership, the Kemper Services team "will remain committed to providing the superior levels of service that our customers have come to expect."

"Being acquired by Platinum will provide us with the backing of a strong financial parent and the independence of a standalone company. We will be able to focus our full attention on building our business and servicing our customers," she said.

"We are very pleased to have a new owner who supports our business model and is committed to our employees and customers," Ms. Drago added. "The management team of the new company will come
from the ranks of the existing Kemper Services management team, and Platinum is offering employment to more than 3,000 Kemper Services employees."

Phil Norment, president of portfolio operations at Platinum, said: "We're very confident in Pat Drago and her ability to lead this business. She and her team have worked hard to maintain a high level of customer service, and their leadership will be imperative in ensuring the stability and continuity of this business moving forward."

A transition team has been assembled and already is working to ensure that the separation from Kemper Services is seamless to customers, said Rob Joubran, chief operating officer for Platinum Equity.

"Platinum has a very customer-focused approach to transition that is designed to ensure there is no disruption in service or service quality," Mr. Joubran said. "We understand that customer relationships are among the most important assets we acquire in a business, and we're going to do everything we can to make sure customers are well-served."

When the transition is completed, the company's customer base will include the Kemper Services Insurance Companies, as it continues to service Kemper Services run-off claims. Kemper Services will eventually be renamed, and details about the new name and brand image will be announced as the transition unfolds over the next several months.

About Broadspire

Broadspire ( www.choosebroadspire.com ) offers the broadest array of absence management services in the industry. Those services include risk and safety consulting; workers' compensation, auto liability; general liability, and short- and long-term disability claim management services; Family Medical Leave Act administration; and total disability management programs. Broadspire creates customized solutions designed to increase employee productivity and contain costs.

About Platinum Equity

Platinum Equity ( www.platinumequity.com ) is a global M&A&O SM  firm specialized in the merger, acquisition and operation of mission-critical services and solutions companies. Since its founding in 1995, Platinum Equity has completed over 40 transactions, building a portfolio of 17 market-leading companies with 16,000+ employees, more than 600,000 customer sites and revenues approaching $4 billion. In 2003 Platinum Equity was named the 34th largest private company by  Forbes.

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Contact:

Stephanie Zercher
(954) 693-1110
stephanie.zercher@choosebroadspire.com