An Australian conglomerate is purchasing one of the nation's largest publicly owned insurance brokerage firms for more than $500 million.
Wesfarmers, a multi-interest conglomerate, said it would purchase OAMPS for $700 million Australian (U.S. $535 million at current exchange rate). The deal involves a cash offer of $4.50 ($3.44) per share of OAMPS stock.
In statements, the companies said the board of OAMPS unanimously recommended accepting the offer in the absence of a superior proposal.
OAMPS was founded in 1976 as the Oil Agents Mutual Provident Society, according to the companies Web site. It has a total of 28 offices, one in England, the remainder in Australia. The company specializes in difficult to place risks with the ability to offer to in-house broking, underwriting, premium financing, and other financial products and services.
Wesfarmers, headquartered in Perth, Australia, was founded in 1914 as a farmer's co-operative. The company's insurance division was founded in 2003 after it acquired Edward Lumley Holdings. The division is comprised of three general insurance companies, two premium funding businesses and an insurance software developer.
In addition to insurance, Wesfarmers operates a retail hardware business, and has other interests in six other industries.
The companies said the agreement calls for OAMPS brokerage division to operate separately from Wesfarmers' underwriting business “to maintain its independence in the market.”
Wesfarmers said its insurance division, under the combined companies, would have pro forma 2006 gross sales of $2.1 billion ($1.6 billion).
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