AUB completes £500m Tysers acquisition
Purchase price represents close to 12 times Tysers’ full-year 2022 pro-forma earnings before interest, tax, depreciation and amortisation
Acquisition of sixth-largest Lloyd’s wholesale broker will provide a ‘step change in capturing further economics in the insurance broking value chain and supporting clients with international placement needs’, Australian group’s chief executive says
Australian broking and underwriting group AUB Group has completed its acquisition of Lloyd’s broker Tysers from Odyssey Investment Partners.
Sydney-based AUB has paid £500m ($614.6m) for 100% of Tysers, the sixth-largest wholesale broker in the Lloyd’s market.
An additional deferred consideration of up to £100m may also be payable if growth targets are met.
The purchase price of £500m represents close to 12 times Tysers’ full-year 2022 pro-forma earnings before interest, tax, depreciation and amortisation.
The acquisition of Tysers, which places around £2bn of premium, was announced in May.
At the time, the future of Tysers had been the subject of much speculation. In May 2021 it was reported Odyssey, which owns Tysers’ parent company, Integro, had ordered the company be made ready for sale, with many brokers tipped as potential buyers.
AUB has said the acquisition will provide access to a “diverse range of risks and insurance types for our clients and broker networks in Australia and New Zealand”.
In the short term, AUB expects to direct around £110m of premium to Tysers from existing and future placements within its broking and agency networks, “creating an uplift in margin and revenue” for the group.
In addition, direct access to Lloyd’s and international markets will provide AUB’s broking network and underwriting agencies with capacity to write additional new business and “deliver differentiated, exclusive products”, the company said.
AUB is targeting around £14m of costs savings.
Mike Emmett, AUB chief executive and managing director, said the acquisition will provide a “step change… 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”.
“The acquisition is not only strategically aligned and financially compelling, but strengthens our operational platform and delivers material scale,” Emmett said.
“We look forward to optimising Tysers’ contribution as part of the AUB Group, a successful integration and delivering on the expected synergies,” he added.
