QBE sells US agency businesses

QBE North America has sold its US agency businesses to Alliant Insurance Services for $300 million.

Alliant will acquire Community Association Underwriters (CAU), Deep South and SIU as part of the transaction which is expected to close in early February 2015.

Alliant will pay an up-front cash payment of $217 million with the remaining cash to be paid by way of a performance based earn-out agreement over the next five years. The total potential sale consideration represents an EBITDA multiple of around 12x.

John Neal, QBE group chief executive officer, said: “We are pleased to announce the progression of another important step of our capital plan in the sale of the US agency businesses at a price we consider to be attractive for our shareholders.”

“An important element of the sale is the long-term agreement that we have entered into to retain the underwriting business provided by the agencies. We look forward to continuing to grow our programme business and to working with Alliant and CAU, Deep South and SIU.”