The expected completion date of Randall & Quilter Investment Holdings’ acquisition of Global U.S Holdings Incorporated has been pushed back by the company.
The $80.5 million deal, first announced on 19 September 2018, was expected to be tied up by the end of the year.
While the acquisition is conditional upon regulatory consent for the change of control R&Q remains confident of achieving this, with the board now anticipating that approval is likely to occur early in 2019.
As a consequence of the applicable accounting requirements, the benefits of the acquisition will now be accounted for in the first half of 2019, rather than the full year 2018.
The board’s current assessment is that, while the group’s profit before tax for 2018 will be below current market expectations, 2019 will be correspondingly above current market expectations.
“We have always stressed the difficulty of predicting the exact timing of legacy deals,” said Ken Randall, Group Chairman and Chief Executive Officer.
“The acquisition of Global Re remains on track and the new business pipeline for legacy is very encouraging. Moreover, Accredited, our programme management business in the USA and Europe, continues to attract a lot of interest.”
“By 31 December 2018, we anticipate having signed contracts with managing general agents which are expected to generate future gross written premiums of around $500m per annum,” he added.
“Both of the Accredited companies have a strong pipeline of further opportunities for execution in 2019.”
“As we have previously indicated, earned commissions on programme business will begin to have a material impact on the Group’s results from the second half of 2019 and beyond.”