Just months after signaling a commitment to its broking operations, Wesfarmers has announced the sale of OAMPS for more than $1 billion.
The broker network, along with Wesfarmers’ premium funding business and Crombie Lockwood in New Zealand, is set to be sold to US broking giant Arthur J. Gallagher.
The deal is set to affect about 1700 employees spread across 50 offices in Australia, New Zealand and the United Kingdom.
Although the acquisition is subject to regulatory approval, is expected to be finalised by the end of the financial year.
When announcing the sale of its insurance operations in December, Wesfarmers Managing Director Richard Goyder said the company was pleased to retain its broking and premium funding operations.
“We really like the broking business. It’s grown significantly in recent years and we like the growth prospects,” he said at the time.
Our combined operations and scale will be a great benefit to our clients.
Headquartered in Illinois, Gallagher is one of the biggest broking firms in the world, with more than 12,000 employees in 16 countries.
Chairman, President and CEO J. Patrick Gallagher Jr says the purchase is a significant step for their plans for expansion in Australia and New Zealand.
“Together we will have a tremendous platform for growth as we expand throughout Australasia,” he says.
“Our combined operations will become one of the largest insurance brokers in Australia and New Zealand.
“Their focus on middle-market clients aligns well with our global client base and will provide us opportunities to bring our full range of services to their existing clients and prospects.
Earlier this year, OAMPS CEO Mike Cutter indicated a firm focus for the group on expanding their own reach across Australia this year.
Wesfarmers Broking Chief Executive Steve Lockwood will head Gallagher’s property and casualty insurance brokerage operations throughout Australasia, reporting directly to Gallagher’s Head of International Operations Tom Gallagher.
“This is genuinely exciting for our people and clients to join with an organization that is like-minded in culture and client focus,” he says.
“Our combined operations and scale will be a great benefit to our clients.”
Gallagher Australasia CEO Andrew Godden says it will be business as usual over the next three months as they work to ensure a seamless transition.
Meanwhile, IAG’s acquisition of Wesfarmers insurance operations cleared a major hurdle recently, after gaining ACCC approval.
Read more about OAMPS plans for the year in our feature here.