Insurance broker Jelf buys northern rival for an initial £10.1m
WORCESTER-based financial services firm Jelf has acquired northern rival Beaumonts Insurance Group in a deal worth an initial £10.1m.
In addition, a deferred consideration of up to £8.28m will become payable upon delivery of agreed performance related increases in annualised EBITDA.
The deal includes Bradford-based Beaumonts’ subsidiaries Beaumonts Insurance Brokers and Beaumonts (Leeds). It also covers the business and certain of the assets of Beaumonts Risk Management.
Jelf provides a broad range of insurance, financial services and employee benefit services to corporates and individuals.
Beaumonts, which also has operations in Leeds and Shrewsbury, is a chartered insurance broker, which also offers health and safety and employment law advisory services through a subsidiary.
Jelf said the acquisition is in line with its strategy of growth through organic initiatives and selected acquisitions, and is expected to be immediately earnings enhancing.
All Beaumonts’ employees, including all the directors, are remaining with the business.
Following the deal’s completion, Jelf’s gross written premiums will increase by around £45m taking the total to around £300m, consolidating the firm’s position as the third largest independent insurance broker in the UK.
It will also significantly increase its presence in the north of England. Jelf has an existing office in Manchester, while the acquisition of The Insurance Partnership in June 2013 brought offices in Hull, York and central Leeds.
The acquisition will be funded by a new £25m loan facility with Barclays. The new debt facility will be used to repay existing debt of £13.7m and provide cash to finance the acquisition. It is a three year facility and at a margin of 2.1% as compared to a margin of 2.3% in the facility it replaces.
