The Innovation Group (TIG) has agreed in principle to acquire Huon Holdings, a leading computer software supplier to the insurance industry, for an undisclosed sum.

The acquisition is subject to several factors, including the satisfactory completion of a due diligence exercise and the approval of shareholders.

TIG or Huon will pay a £4m fee to the other party if the sale is not completed.

Huon's main product is an internet-ready, end-to-end information management system with components for client management, rating, policy administration, billing, claims administration and agency management.