Welsh intermediary Moorhouse has acquired Shakespeare Underwriting from Andrew Booth, sole owner of the Bentley Group, for an undisclosed sum.

The purchase increases Moorhouse's gross written premiums (GWP) by 70% from £20m to £32m.

Moorhouse is understood to have won the auction for the troubled wholesale broker from a group of around thirty interested parties.

According to sources close to Shakespeare the level of interest was so high because Shakespeare's dealings with Arab German Insurance (AGI) left the business massively undervalued at around £300,000.

AGI achieved notoriety for refusing to pay thousands of pounds worth of outstanding claims, many of which related to the Boscastle floods.

The source told Insurance Times: "Shakespeare's broker distribution channel and product range are still very strong. To add £12m GWP for the price Tenon [Shakes-peare's administrator] were asking was an absolute steal."

Lyndon Wood, chairman of Moorhouse Group, is understood to have discussed with the FSA the company's obligations to insurers, brokers and policyholders affected by their involvement with Shakespeare before committing to buy the company.

Wood said: "Back-log and legacy issues are the responsibility of Tenon but we will work with them to assist where possible."

The acquisition is the first of a string of purchases planned by Moorhouse in a bid to enter the top 50 national brokers.