Control of NZ-listed Insured Group will pass to online service provider Priority One Network Group when it lists later this year.

Priority One CEO Peter Stafford told insuranceNEWS.com.au the group plans to hold 51% of Insured Group on achieving a Australian Securities Exchange (ASX) listing, which is “imminent”.

The deal will also require Insured Group shareholder approval and an independent expert’s report.

Priority One is paying $200,000 on completion of the report, which will be sent to Insured Group shareholders before any meeting.

In a complex deal both Insured Group and Priority One will exchange shares in their respective companies. Once the two companies sign a formal agreement on the takeover, Priority One will issue Insured Group 7.6 million shares, valued at $2.2 million on listing.

In exchange Insured Group will give Priority One 19% of its issued share capital and will provide a single board seat.

After Priority One has been accepted for ASX listing, Insured Group will receive another 9 million shares in the service provider in exchange for a further 30% of the insurer’s issued capital.

The final 2% of Insured Group shares will be released on Priority One’s listing.

In May this year Insured Group announced it was forming a joint venture with Priority One to distribute insurance products to 400 million users of trading merchants the company claims to have signed agreements with.

Mr Stafford confirmed this joint venture vehicle, Priority One Insured, has been replaced by the new deal.

“This looked liked a better business model and has replaced Priority One Insured,” he said.

In August Priority One agreed to create a joint venture with ASX-listed GoConnect to create a full service advertising, purchasing and transaction services platform for merchants and consumers.

“We will be using the GoConnect agreement to deliver insurance products,” Mr Stafford said.

Meanwhile Insured Group has announced the Priority One deal will delay releasing its audited accounts due to “unforseen resourcing matters within its auditors, coupled with the requirement to fully reflect the significant transaction with Priority One Network Group”.

Insured Group MD Wayne Miller did not return calls from insuranceNEWS.com.au requesting comment on the deal.