Insurance Australia Group Limited (IAG) has announced the purchase of Wesfarmers Ltd underwriting businesses, the brands include Lumley, WFI and Coles insurance.
IAG Managing Director and Chief Executive Officer, Mike Wilkins, said the acquisition is a compelling strategic fit for IAG. “This is a unique opportunity, which is expected to deliver significant long term value for IAG shareholders and unlock further growth potential for our businesses in Australia and New Zealand,” he said.
The units will be incorporated into the CGU, Chief Executive Officer, Peter Harmer, said the addition of WFI and Lumley confirms CGU’s position as the leading intermediated insurer in Australia.
He said the combined business would have enhanced scale and capability to meet the needs of its customers and partners, providing them with access to broader product offerings.
“These businesses have a lot in common, with long and proud histories, a heartland in regional and rural Australia, well known and respected brands, a strong presence in SME and a growing capability in the large corporates segment. The addition of WFI and Lumley also provides CGU with solid positions in attractive segments, such as commercial motor,” he said.
He said the combined business would have enhanced scale and capability to meet the needs of its
customers and partners, providing them with access to broader product offerings.
“These businesses have a lot in common, with long and proud histories, a heartland in regional and
rural Australia, well known and respected brands, a strong presence in SME and a growing capability
in the large corporates segment. The addition of WFI and Lumley also provides CGU with solid
positions in attractive segments, such as commercial motor,” he said.
The acquisition will be funded through a combination of ordinary equity, subordinated debt and internal funds, the acquisition is expected to be completed by the second quarter of 2014.
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