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- Insurance company AUB Group (AUB) has pooled $272 million to buy two Australian insurance companies
- AUB has increased its stake in MGA Whittles to 100 per cent for $140 million
- MGA Whittles is an Adelaide-based insurance broking company formed in the 1970s
- In addition, AUB has bought a 40 per cent interest in BizCover for $132 million
- BizCover is a digital insurance platform
- AUB and BizCover will deliver a quote-to-bind platform called ‘Austbrokers ExpressCover’
- This is an exclusive platform for Austbrokers members
- AUB Group is up a slight 2.27 per cent and shares are trading for $13.08 each
Insurance company AUB Group (AUB) has pooled $272 million to purchase two Australian insurance companies.
MGA Whittles
AUB has increased its 49.9 per cent stake in MGA Whittles Group to a full 100 per cent ownership.
MGA Whittles is an Adelaide-based insurance broking company that provides a vast range of industries with broking and risk advisory services.
To acquire the additional 50.1 per cent in MGA Whittles, AUB will pay $140 million which includes $29.1 million in cash and 8,764,996 fully paid ordinary shares.
These will be issued within AUB’s 15 per cent placement capacity by July 31 2020 at $12.6490 per share
“As one of Australia’s largest insurance brokers, the acquisition places MGA at the heart of Austbrokers and enables the next phase of our growth. In addition, the Whittles strata specialty will add a significant complementary capability to AUB,” AUB Managing Director and CEO Mike Emmett said.
As part of the deal, key MGA shareholders will take a combined stake of 10.7 per cent in AUB Group.
“Selling the MGA Whittles Group in exchange for a significant stake in AUB will allow us to fully leverage our long-term partnership to accelerate the growth of the MGA Whittles group,” MGA Executive Chairman John George said.
BizCover
AUB Group has acquired a 40 per cent interest in BizCover for $132 million.
BizCover is Australia’s leading online insurance distribution platform. It digitally delivers insurance quotes to customers, which gives them the ability to purchase cover instantly.
As part of the deal, AUB Group and BizCover will deliver ‘Austbrokers ExpressCover’, a new quote-to-bind platform for Austbrokers members which enhances their service offerings.
“BizCover’s scalable platform and experience in managing high volume SME insurance along with AUB’s significant market share will bring mutual opportunities and benefits,” BizCover Managing Director Michael Gottlieb said.
“We look forward to working closely with AUB to continue to innovate and simplify the purchasing of SME insurance,” Michael added.
AUB will fund the BizCover acquisition with cash and undrawn debt and the cash portion of the MGA Whittles transaction through an extension of its existing debt facilities.
AUB Group is up a slight 2.27 per cent and shares are trading for $13.08 each at market close.
