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(Alliance News) - R&Q Insurance Holdings Ltd on Friday said it has entered into a conditional agreement to sell 100% of its interest in Randall & Quilter America Holding Inc.
In September, it confirmed that it was in "an advanced stage of discussions" with Onex Corp to sell programme management business Accredited. Onex is a Toronto-based private equity firm.
R&Q Insurance previously had said it was reviewing strategic options, which included the legal separation of Accredited and R&Q Legacy.
On Friday, it said it has entered an agreement to sell Accredited for USD465 million, representing an expected equity value of approximately USD438 million.
It noted that net cash proceeds from the sale are expected to be approximately USD300 million. Cash proceeds available for utilisation immediately on closing are expected to be between approximately USD170 million and USD210 million, it added.
"The available net cash proceeds will be entirely used to facilitate a material de-leveraging of R&Q," the company said.
Chair Jeff Hayman said: "The sale will generate meaningful net cash proceeds which will facilitate a material de-leveraging of the group while also strengthening its liquidity and working capital position, which will support R&Q's ongoing commitments and requirements. Furthermore, the sale will create a simpler and better capitalised R&Q which will be positioned to continue to execute the existing strategy of transitioning to a capital efficient and stable recurring fee-based business model."
By Sophie Rose, Alliance News reporter
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