AUB has abandoned its planned acquisition of Coverforce Holdings after failing to gain access to key documents required to finalise the proposed $150-200 million deal.

The company said in August it had agreed to buy a 49% stake held by private equity investor Pemba Capital Partners and would then acquire the remaining equity.

The takeover deal conditions include delivery of due diligence materials to AUB by a date agreed with Pemba, but Coverforce shareholding levels and associated sale rights have been in dispute in the NSW Supreme Court.

As reported in a Breaking News bulletin earlier today, the materials have not been delivered and AUB has not waived its right to due diligence.

“In consequence, and as the parties have been unable to reach agreement on an amended date for delivery of due diligence materials, the conditional sale agreement has terminated.” Group General Counsel and Company Secretary Freya Smith says in a market release.

Under the initial timetable, due diligence was due to be completed by the end of September, paving the way for the acquisition to be wrapped up in the fourth quarter.

AUB has previously said it is protected by “walk-away rights” if the deal did not go ahead.

South African-owned Pemba acquired a stake in Coverforce in 2012 and maintains it properly triggered exit clauses after receiving a proposal from AUB in May.

But Coverforce founder Jim Angelis disputed Pemba’s right to trigger a sale and took court action.

The case before Justice James Stevenson in Sydney is yet to be decided and includes a dispute over contested shareholding agreements involving Adrian Kitchin, Drue Castanelli and Ben Hastie, who this year completed a buyout of authorised representative company Resilium from Suncorp.

Coverforce was established in 1994 and is the largest privately owned insurance broker in Australia, focusing on the SME, mid-market and large corporate clients.

AUB said today it will continue to apply a disciplined approach to its mergers and acquisitions strategy as it looks to acquire businesses that accelerate scale and growth, leverage and expand its expertise and add to its core capabilities.