Reinsurance News

AUB Group completes Tysers acquisition

30th September 2022 - Author: Pete Carvill

Australia equity-based insurance broker network AUB Group has completed its acquisition of Tysers.

In accordance with the terms of the acquisition and as previously announced, AUB confirmed that it has issued 9,018,974 new shares to Tysers’ former owner, Odyssey Investment Partners. The new shares will be escrowed for a 24-month period.

AUB has drawn down AUD $598m of its new AUD $675m multi-currency debt facility. AUB expects leverage to reduce over the next 12 months.

Mike Emmett, CEO and managing director of AUB, said: “We are very pleased to welcome the Tysers team. Given Tysers’ position as a leading specialist wholesale insurance broker in the largest insurance market in the world, we are excited in the step change Tysers will bring to AUB in terms of capturing further economics in the insurance broking value chain, accelerating scale in AUB Agencies, and supporting our clients with international placement needs.”

He added: “I have known Tysers and its executive team for an extensive period of time and AUB has been working with Tysers for many years providing our clients access to Lloyd’s market for specialist insurance. I have always been very impressed with the quality of the franchise, the knowledge and expertise of the team, and its deep client relationships. The acquisition is not only strategically aligned and financially compelling but strengthens our operational platform and delivers material scale. We look forward to optimising Tysers’ contribution as part of the AUB Group, a successful integration and delivering on the expected synergies.”

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It was back in April that AUB confirmed that it was having ongoing discussions around acquiring Tysers. The announcement came amidst widespread reporting that the two firms had reached an agreement in which AUB had won a bidding war for Tysers. However, AUB sent out a brief release to clarify that while discussions have taken place, a resolution is yet to be reached.

Reports in the B2B media stated that the Sydney-based AUB Group was the frontrunner to take over Tysers, ahead of Ardonagh. In addition, it was reported that final terms were close to being agreed. Others said to be in contention at one point to buy Tysers were Miller and Austbrokers.

That announcement came at a point when Tysers had been selling off a number of its businesses and assets. In January, it was reported here that Xenia Broking Group had acquired its UK trade credit and surety business.

A month later, it was announced that an agreement to acquire wholesale broker Tysers from its current owner, Odyssey Investment Partners, for a sale price of AUD $880m. The purchase price implied at the time a 9x FY22 pro forma EBITDA, and with an additional deferred consideration of up to AUD $176m payable two years post completion, subject to Tysers’ achievement of agreed revenue growth targets with an upper bound of £220m.

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