Towergate-owned network favoured as likely buyer for South West broker group.
Plymouth-based network Westinsure has held advanced talks with a number of potential acquisitors, believed to include Towergate-owned Broker Network.
Rival Cobra has also been named as a potential buyer by market sources. AXA is believed to have looked at Westinsure, but decided against making a bid. The network is thought to be considering a price of between £6m and £10m.
In January, Insurance Times reported that Westinsure managing director Denis Morgan was considering what he called strategic leaps, amid widespread speculation that he had already approached rival networks about a sale.
It is thought AXA would prefer to grow its own network organically rather than by acquisition because of the high cost of buying a network. A source said: “Towergate [which owns Broker Network] is the likely buyer.”
Morgan denied starting a bidding process, adding: “It is fair to say that many businesses have shown an interest in Westinsure over the past 18 months. Why wouldn't they, we are doing pretty well?”
Earlier this year Morgan said the group would consider joint ventures, mergers, acquisitions or partnerships. “There are a number of organisations in the market which might complement our business model well. We are not ruling anything out,” he said.
The Westinsure network currently controls £234m of gross written premiums from 128 members around the UK. Morgan said it was currently on track to hit its 2008 target of £300m GWP.
Its dominance in the South West has been challenged by the emergence of the Purple Partnership network, created by Jelf and led by former Westinsure managing director Bob Parkins.