Australia-based PSC Insurance Group (PSC) has signed an agreement to purchase all share capital of Ensurance (ENA) in a deal valued at A$25.2m ($16.55m).
ENA is an underwriting agency engaged in offering professional and financial line services.
PSC expects the acquisition to bring “high growth operation”, expand the product portfolio of its speciality business in Australia, and create growth opportunities for the group.
The purchase price is equivalent to an indicated valuation of the ENA agency business of A$18m ($11.82m) and approximately A$7m ($4.6m) in net assets.
PSC will fulfil the purchase price by issuing five million PSC Shares to ENA shareholders and the difference between the share price and the A$25.2m ($16.55m) purchase price will be made up in cash.
ENA shareholders will be eligible to receive approximately 0.056 new PSC shares for every ENA share held.
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ENA chairman Tony Leibowitz said: “In considering the future of the company, the board looked at a range of factors, ultimately securing with PSC a transaction which will see the ENA operations continue to grow and thrive as part of a much larger company that has the balance sheet strength, resources and global reach required to help unlock its full potential.
“This transaction delivers a healthy premium to the current market price of ENA shares, and the scrip consideration will allow ENA shareholders to retain exposure to the continued growth and development of the business.”
Subject to multiple conditions, the acquisition is expected to complete in November 2023.
Earlier this year, PSC acquired ENA’s UK business in a deal valued at A$8.2m ($5.38m).