Arthur J. Gallagher To Buy Wesfarmers’ Insurance Broking Unit
Wesfarmers Ltd. agreed to sell its insurance broking units to Arthur J. Gallagher & Co. for A$1.01 billion ($938 million) as the Australian conglomerate exits its insurance business.
Wesfarmers expects pretax profit of A$310 million to A$335 million on the sale, the Perth-based company said in a statement today. The broking businesses include OAMPS Insurance Brokers Ltd. in Australia, OAMPS (UK) Ltd. and Crombie Lockwood Ltd. in New Zealand.
Wesfarmers agreed to sell its insurance underwriting business to Insurance Australia Group Ltd., for A$1.85 billion Dec. 16. The company, which owns coal mines, chemical producers and an investment bank, has been shifting spending to its Coles supermarket chain it bought in 2007 in Australia’s largest corporate takeover.
The agreements to sell the insurance underwriting operations and the broking businesses are “consistent with the company’s focus on disciplined portfolio management having regard to the long-term interests of shareholders,” Managing Director Richard Goyder said in a statement.
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