- PSC Insurance Group has agreed to buy Paragon International holdings for £42 million (A$75 million)
- $35 million from an institutional share placement
- 13.46 million shares at a price of $2.60 per shares
- acquisition will provide PSC with exposure in the US market
PSC Insurance Group has agreed to buy Paragon International holdings for £42 million (A$75 million).
The company will raise $35 million from an institutional share placement to finance part of the Paragon acquisition.
The Placement will include 13.46 million shares at a price of $2.60 per share. PSC is hoping to raise $35 million.
PSC is a diversified insurance service group with operations in Australia, United Kingdom and New Zealand.
Paragon is a leading independent Lloyd’s and London Market broker.
Last year Paragon achieved revenues of £21 million ($37.6 million) and £4.2 million ($7.5 million) in underlying earnings before interest, tax, depreciation and amortisation (EBITDA).
The business provides wholesale brokerage services to clients in the United States and United Kingdom. 60 per cent of Paragons revenue is made in the US wholesale market
This means the acquisition will provide PSC with exposure in the US market and will approximately double the EBITDA of PSC’s UK business.
Following the acquisition PSC group will be leading Lloyd’s broker with a greatly enhanced market profile and 100 per cent of controlled subsidiaries, premiums of approximately £500 million (A$900 million).
Earlier this month PSC announced a $48 million takeover of Shepparton based Griffiths Goodall.
PSC Managing Director Tony Robinson is happy with the acquisition.
“The acquisition of Paragon will greatly add to the scale and expertise within our UK businesses and we will enhance our position as a leading Lloyd’s broker providing services to US insurance brokers,” he said.
Paragon Co-CEO James Kalbassi agrees that this acquisition benefits both companies.
“This is a very exciting transaction. We are building from a position of strength, with a compelling, broader independent platform to create a more powerful specialty broking business,” he said.
PSC Insurance has gained 2.22 per cent and is currently selling at $2.76 per share.