24 March 2016 Insurance

Towergate to sell majority interest in Broker Network

Insurer Towergate is selling its majority interest in Broker Network to US investment firm Highbridge Principal Strategies for a consideration of up to £46 million.

David Ross, chief executive officer (CEO) of Towergate, said in the firm’s FY2015 financial report that the proceeds of the transaction will allow the firm to accelerate its investment programme, providing it an extra focus and provides Broker Network with a strong platform for growth.

Ross also said that Towergate is investing more than £14 million to upgrade its IT infrastructure, part of a wider investment initiative in the business that it hopes will drive significant improvements in its back and front office.

He said: “With crucial integration projects already underway, we expect to begin rolling out new systems to support the front end of our business by the beginning of Q3 2016. This will undoubtedly improve the experience of our staff and customers, and lead to annual savings of approximately £4 million.”

Towergate has also secured a short-term loan facility from Highbridge for of up to £28 million, which will result in a cash injection to the Group if it is drawn.

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