Ockham Holdings' proposed purchase of Link Insurance Services has been abandoned.
In March, Lloyd's syndicate Kiln announced it was considering selling Link, its Maidstone-based subsidiary, as part of a strategic review of its operations. In August, Ockham announced it had entered into negotiations to buy Link, which writes mainly motor business.
At the time, Ockham chief executive and chairman of its motor subsidiary Highway, Lord Poole, said: "One of our long-term goals is to become a specialist motor insurance company and Link is a perfect fit geographically."
A spokesman for Ockham said the deal has now been cancelled following market changes from the World Trade Centre tragedy and concerns about reinsurance costs.
"On 16 August, Ockham and Kiln announced they had signed conditional heads of agreement for the sale of the entire issued share capital of Link," he said.
"Completion of the transaction was subject to contract, final due diligence and regulatory approval being obtained. Both parties have now decided not to proceed with the transaction."