The Insurance Brokers Network of Australia (IBNA) – part of the AIMS joint venture – is splitting up with Austbrokers and moving across to the Steadfast network.

The shock move was announced by Steadfast to the Australian Stock Exchange (ASX) this morning.

IBNA has more than 90 member companies, each of which is independently owned. They handle a combined annual gross written premium of about $1.4 billion.

Under the arrangement with Steadfast, IBNA members will move across individually, meaning IBNA itself will cease to exist. The decision to quit the Austbrokers & IBNA Marketing Services joint venture and move to a new arrangement with arch-rival Steadfast changes the broking landscape in the Australian market. 

The arrangement is subject to further due diligence, agreement on structuring issues and any necessary regulatory approvals. 

The initial purchase price is estimated at $76 million. “The consideration is likely to involve the issue of Steadfast shares on completion…with IBNA members receiving consideration in proportion to the total rebate each member receives from IBNA and [AIMS].”

The initial consideration is subject to adjustment if not all IBNA members join the Steadfast network , if Steadfast does not accept the application of any IBNA member, or if the figures used in the calculations change.

“The expected future impact on SDF will be clarified when the final transaction size and timing is more definite,” Steadfast says.

insuranceNEWS.com.au will have further reports on this development – including interviews and analysis – in our 4.45pm Daily bulletin.