RSA announces completion date for acquisition of DLG’s commercial lines operations

RSA Insurance and owner Intact Financial Corporation have received approval to acquire Direct Line Group’s (DLG’s) brokered commercial lines operations.

A statement released today (19 October 2023) said that all conditions related to deal had now been fulfilled, with the transaction set to close next week (26 October 2023).

The purchase has been agreed for an initial fee of £520m, with potential for up to a further £30m contingent on earnout provisions related to financial performance of the acquired business lines.

While the deal is set to close next week, the portfolio will be dated as having been transferred to RSA and Intact as of 1 October 2023 through a quota share reinsurance agreement.

’Transformational deal’

When the deal was announced last month (6 September 2023), RSA said the transaction would see it become the UK’s third largest commercial lines insurer with an estimated 7% of total market share.

The insurer also said acquisition would broaden its broker distribution network and expand its commercial lines product offering.

Ken Norgrove, chief executive at RSA, added: “This is a unique and transformational deal for us – it really turbo boosts our existing strategy for our broker proposition and our customer proposition in commercial.

“What we’re acquiring is DLG’s commercial lines brokerage business, 98% of which is the NIG brand and FarmWeb brand – this is significantly transformational for us complimentary to our own business.

“We’ve been very strong in the mid-market and specialty areas, but what this really does is bring us into play in the sub-10,000 space and cements our proposition in the SME space.”