SCHEDULE 13D/A: Markel Group Amends Hagerty Stake, Nominates New Board Member

Markel Group Inc. has filed an Amendment No. 3 to its Schedule 13D, detailing its continued significant beneficial ownership in Hagerty, Inc. and announcing a change in its designated board representative.

Summary

• Markel Group Inc. (formerly Markel Corporation) filed Amendment No. 3 to its Schedule 13D regarding its stake in Hagerty, Inc.
• As of April 18, 2025, Markel Group beneficially owns 79,380,265 shares of Hagerty's Class A Common Stock, representing approximately 47.7% of the outstanding shares.
• This beneficial ownership includes 75,000,000 shares of Class V Common Stock and an equal number of OpCo Units, exchangeable one-for-one into Class A Common Stock or cash.
• It also includes 1,590,668 shares of Series A Preferred Stock, exchangeable into 1,272,265 shares of Class A Common Stock.
• Additionally, Markel Group directly holds 3,108,000 shares of Class A Common Stock.
• Despite the 47.7% Class A beneficial ownership, Markel Group controls approximately 28.9% of the total voting power of Hagerty, considering both Class A and Class V Common Stock.
• F. Michael Crowley, a former Executive Consultant and retired Vice Chairman of Markel Group, will not seek re-election to Hagerty's Board of Directors at the upcoming Annual Meeting.
• Markel Group has selected Michael R. Heaton, its Executive Vice President and Chief Operating Officer, to replace Mr. Crowley as its designee on Hagerty's Board, and Hagerty has agreed to nominate Mr. Heaton for election.

Sentiment

Score: 6

Explanation: The document is largely neutral as it is a regulatory disclosure of ownership and a planned board change. The continued significant stake and active board representation by Markel Group could be seen as a positive signal of confidence, but there are no new financial performance metrics or strategic initiatives disclosed that would significantly alter sentiment.

Positives

• Markel Group maintains a substantial beneficial ownership stake in Hagerty, indicating continued strategic interest and alignment.
• The nomination of Michael R. Heaton, a current Executive Vice President and Chief Operating Officer of Markel Group, to Hagerty's board suggests a strong, active representation of Markel's interests and potentially deeper operational alignment.

Negatives

• The document does not present any explicit negative financial or operational outcomes for Hagerty, Inc.

Risks

• The Class V Common Stock held by Markel Group carries 10 votes per share until December 2, 2036, or upon transfer to a non-qualified transferee, after which it converts to one vote per share, indicating a future shift in voting power dynamics.
• The exchangeability of Class V Common Stock and OpCo Units into Class A Common Stock or cash at the Company's option introduces a potential for dilution or cash outflow depending on the Company's decision at the time of exchange.

Future Outlook

Markel Group's future outlook for Hagerty includes continued representation on its Board of Directors, with a new designee, Michael R. Heaton, expected to be nominated and elected at the upcoming Annual Meeting on June 3, 2025. The long-term voting structure of Class V Common Stock is set to change by December 2, 2036, or upon transfer.

Industry Context

This filing reflects a significant shareholder's ongoing strategic involvement in a publicly traded company, common in industries where large institutional investors or strategic partners hold substantial stakes. Markel Group, a diverse financial holding company specializing in specialty insurance, continues to maintain a strong position in Hagerty, a company focused on automotive lifestyle and insurance, suggesting continued alignment within the broader insurance and enthusiast market segments.

Management Changes

Corporate Governance

Stakeholder Impact

• Shareholders: The change in board representation by a major shareholder could influence strategic direction and oversight. The detailed breakdown of beneficial ownership provides transparency.
• Management: The new board member from Markel Group will interact with Hagerty's management, potentially influencing operational and strategic decisions.
• Employees: No direct impact on employees is mentioned in this filing.

Next Steps

• Hagerty, Inc. will hold its annual meeting on June 3, 2025, where Michael R. Heaton is expected to be nominated and elected to the Board of Directors.
• F. Michael Crowley will cease to be a member of the Board immediately prior to the Annual Meeting.

Key Dates

Recommendation

Keywords

Hagerty Inc., Markel Group Inc., SEC Filing, Schedule 13D, Beneficial Ownership, Class A Common Stock, Class V Common Stock, OpCo Units, Series A Preferred Stock, Board of Directors, Corporate Governance, Shareholder Stake, Financial Holding Company, Specialty Insurance