27 June 2017Insurance

Suncorp beats $144m Fairfax deal to acquire New Zealand's Tower

Suncorp subsidiary Vero Insurance has won the battle to acquire New Zealand-based general insurer Tower, beating Fairfax Financial's $144 million all-cash offer.

Suncorp has announced that the companies have entered into a Scheme Implementation Agreement whereby it is proposed that Vero will acquire all of Tower’s ordinary shares (at NZ$1.40 per share) it does not currently own by way of a Scheme of Arrangement.

In February, Canada-based property and casualty re/insurer Fairfax had agreed to acquire 100 percent of Tower shares at NZ$1.17 ($0.84) per share for an aggregate acquisition cost of NZ$197 million ($144 million).

Vero stated that it will work closely with the Tower Board to bring the transaction to fruition.

According to the press release, the Scheme of Arrangement remains subject to a number of conditions, including approval by Tower shareholders and court approval. The transaction is also subject to necessary regulatory approvals, including approval from the New Zealand Commerce Commission and the Reserve Bank of New Zealand.

Tower is one of the largest insurers in New Zealand and the Pacific Islands.

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More on this story

9 February 2017   Canada-based Fairfax Financial Holdings, a property and casualty re/insurer, has agreed to acquire New Zealand-based general insurer Tower for an all-cash deal.
27 June 2017   USI Insurance Services (USI) said on June 27 that it has entered into an agreement with Wells Fargo & Company to purchase Wells Fargo Insurance Services USA.
26 July 2017   New Zealand's Commerce Commission has declined to grant clearance to Suncorp subsidiary Vero Insurance to acquire up to 100 percent of the shares in general insurer Tower.