Highway Insurance's retail division has acquired personal lines broker A Quote Insurance for £4.6m.
Highway paid £4.18m in cash and the remainder in shares and unsecured loan notes for A Quote. The acquisition is expected to generate pre-tax profits of £600,000 from turnover of £5.2m for the year ending 31 October 2004.
Highway Retail managing director Paul Cosh said: "This first acquisition is the start of Highway's ambitious drive to purchase a portfolio of well-managed and profitable insurance intermediaries."
Highway denied that the acquisition was a fall back after the merger with Cox fell through four months ago.
Highway underwriting sales and marketing director Chris Hill said: "A Quote was not a contingency plan. We were in talks with A Quote before we spoke with Cox. When we began talks with Cox the A Quote acquisition was put on the back burner."