SYDNEY: Ensurance Ltd (ASX: ENA) has executed an agreement to acquire 100% of the issued share capital of TK Specialty Risks Pty Ltd trading as TKSR (TKSR) from its sole shareholder for $2,500,000, to be satisfied by the issue of shares in ENA.
TKSR was established in November 2015 as an underwriting agency wholly dedicated to Professional and Financial Lines insurance, underwritten on an intermediated basis via insurance brokers.
TKSR offers premium standard products in well-established lines of insurance, such as Management Liability and Professional Indemnity, but also has a strong emphasis on providing solutions for emerging risk classes, including Cyber Liability. Additionally, TKSR offers first-rate claims handling expertise, principally in partnership with global insurer, AXA.
TKSR has experienced strong, profitable growth in recent years through its network of more than 70 insurance broking houses Australia-wide and now has insurance premiums under management in excess of $10 million.
Ensurance, through its UK operations, has established a growing and profitable business, aided by the recent launch of its new IT system and newly announced capacity relationship with AXA Insurance UK Plc.
Following these milestones, ENA has been seeking to grow and scale its existing business as well as consider earnings accretive acquisition opportunities when they present.
Company believes TKSR, through its complementary underwriting business lines and existing partnership agreement with AXA, provides an excellent opportunity to scale and grow into the Australian market.
Australia has seen significant growth in more personalised product offerings, which is where TKSR has been building its presence through specialty underwriting. The nature of TKSR’s specialised underwriters allow it to create bespoke and tailored solutions to address the needs of individual clients.
Ensurance, through TKSR and further acquisitions, intends to grow its Australian operations by expanding into New Zealand and the wider Asia Pacific markets over time.
In consideration for the acquisition of the TKSR shares, Ensurance will (subject to receipt of shareholder approval) issue the vendor with 83,333,334 fully paid ordinary shares in the capital of the Company at a deemed issue price of $0.03 per ENA Share.
The Company will convene a general meeting to seek shareholder approval for the issue of these shares in due course.
Commenting on the acquisition, Tom Kent, Founder/CEO TKSR, commented: “We are very pleased to form this partnership with Ensurance which creates an opportunity to build on our footprint in Australia…”
Commenting on the acquisition, Tony Leibowitz, Chairman Ensurance, said: “Ensurance has focused on repositioning the business over the last 2 ½ years and is now seeking to build from this platform. TKSR, and in particular, its CEO, provide the Company with an excellent opportunity to expand and grow in the Australian market through its complementary lines of business activity….”
Ensurance Ltd (ENA) is the holding company that owns three distinct businesses in the Insurance Industry. They are an Insurance Brokerage, an Underwriting Agency and an IT company.