Suncorp may be close to finalising the sale of its Resilium authorised representative (AR) network after commencing a review of the business last year.
The insurer has retained corporate adviser 333 Capital to examine options including a sale, joint ventures or partnerships, while also leaving open the possibility of continuing to invest within the current structure.
It now appears most likely the business will change hands through a management buyout in a deal worth about $25 million, according to the Australian Financial Review.
A Suncorp spokeswoman told insuranceNEWS.com.au the company does not comment on speculation.
Resilium was formed in 2011 from the acquisition of AMP’s long-established general insurance sales unit. It later launched a broking arm, Resilium Insurance Broking, which is part of – but not owned by – the Steadfast network.
The business is led by Adrian Kitchin, who joined from Insurance Advisernet in 2015. Mr Kitchin has formerly worked at Liberty International Underwriters and was general counsel at Aon Risk Solutions.
Resilium reported revenue of $69.2 million last financial year and a profit of $159,000.
The disposal of Resilium by Suncorp would follow IAG’s decision last year to sell its AR group, Community Broker Network, to Steadfast for an undisclosed sum. The insurers are honing their strategic focus and jettisoning unwanted operations.
Suncorp has recently wrapped up the $725 million sale of its life insurance business to TAL Dai-ichi Life. The deal included a 20-year strategic alliance to earn distribution income from life cover issued by TAL.
The company today said it would pay a fully franked special dividend of eight cents a share as part of announced plans to return about $600 million of capital to shareholders. The special dividend represents about $100 million of the life net sale proceeds.