Under the agreement, Steadfast will pay A$148.8m ($96.41m) in cash upfront to Sure Insurance.
The transaction includes two potential earn-out payments of A$28.8m and A$102.5m based on Sure Insurance’s performance in FY24 and FY25, to be paid at the end of each year.
A put and call option agreement was also signed between the companies for up to two-thirds of the remaining 30% stake in Sure Insurance, with an exercise date between September and October 2026.
Sure Insurance is an underwriting agency engaged in offering home and contents insurance in Queensland.
Through this deal, Steadfast aims to bolster and diversify its position as an underwriting agency in Australasia.
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Currently, Sure Insurance is binding more than 52,000 policies, with a nearly 85% retention rate and significant room for growth, it added.
Steadfast Group managing director and CEO Robert Kelly said: “Consistent with our growth strategy, Steadfast Group continues to pursue highly attractive acquisitions that are complementary to the existing portfolio and continue to further enhance Steadfast Group as the largest general insurance broker network and largest group of insurance underwriting agencies in Australasia.
“Sure Insurance is a highly compelling acquisition opportunity, and there is strong cultural alignment between the two organisations. We look forward to partnering with the Sure Insurance team to continue providing unique solutions to the market in regional Queensland and support Sure Insurance’s continued growth.”
Sure Insurance managing director Bradley Heath said: “We are delighted to be working with Steadfast Group, an organisation aligned with our philosophy at Sure Insurance. We are particularly excited by the potential opportunities Steadfast can provide to support our growth and expansion.”
The transaction is expected to be completed by 30 November 2023.
In October, Steadfast forayed into the US market with the acquisition of ISU Group, a privately owned independent insurance agency network.