Swedish private equity firm EQT has initiated a move to acquire AUB Group, one of Australia’s largest insurance broking networks, with a proposal that values the company at $5.25 billion (US$3.41 billion).
The offer, announced Tuesday, would see EQT pay A$45 per share – representing a 25% premium over AUB’s most recent closing price.
AUB Group has confirmed it is providing EQT with exclusive access to its financial records for a six-week review period that began on October 8.
The agreement, which includes confidentiality and exclusivity clauses, allows EQT to conduct due diligence as it considers the acquisition.
This latest proposal follows an earlier approach from EQT at $43 per share.
The bid comes at a time of ongoing shifts in AUB Group’s shareholder base.
Last year, Odyssey Investment Partners, a US private equity firm, reduced its stake in AUB by nearly $277 million, according to Reuters.
Current major shareholders include First Sentier Investors and Capital World Investors, according to LSEG data.
AUB’s share price has been largely stable over the past 12 months, lagging behind both the broader market and its main competitor, Steadfast Group. Despite this, the company continues to attract interest from institutional investors.
The Australian insurance sector has recently seen increased merger and acquisition activity, with both international and private equity investors targeting local firms.
“With organic opportunities for brokers moderating and brokers well capitalised following a firm pricing market, we would not be surprised if M&A continued to feature in the broking landscape,” analysts at Jarden said, as reported by Reuters.
The acquisition proposal coincides with the release of AUB Group’s FY25 financial results.
The company reported underlying net profit after tax (NPAT) of over $200 million, an increase of more than 17% from the previous year.
Group CEO Michael Emmett described FY25 as a year of “solid financial results, international expansion, and operational progress across all divisions,” according to an ASX statement.
AUB’s revenue for the year rose by approximately 12%, reaching about $1.5 billion, while gross written premium (GWP) for the period was $11 billion.
The Australian broking division posted profits of $135.6 million, up more than 12%, and the New Zealand division reported a profit increase of just over 2% to $23 million.
The group’s agencies, including Tysers, recorded a pre-tax profit increase of 30% to $72 million, with agency revenue up 25.1% and margins expanding to 44.2%.
BizCover, AUB’s direct-to-consumer insurance platform, reported revenue growth of 15%, surpassing $100 million.
AUB declared a final dividend of 91 cents per share, representing a 15.2% increase from FY24.
Looking ahead, Emmett stated that AUB Group is entering FY26 with an emphasis on “disciplined execution, strategic investment, and continued optimisation.”
The proposed acquisition by EQT, alongside AUB’s financial performance, highlights the ongoing consolidation and competitive positioning within Australia’s insurance broking sector as both local and global investors seek growth opportunities.
