Ardonagh’s $2.3 billion acquisition of PSC Insurance Group is expected to take effect in October, assuming shareholders vote in favour of the deal at meetings next month.

The offer is recommended by the board and has been assessed as “fair” and “reasonable” in an independent expert report released last week ahead of the September 26 meetings.

PSC last week also reported what are likely to be its final full-year results as a listed Australian company before becoming part of UK-based Ardonagh, a top 20 broker globally.

Chairman Paul Dwyer says if the deal takes effect it would be about 18 years since PSC started and nine years since its initial public offer.

“We are excited for the next phase of PSC’s evolution in partnership with a global leading broker in the Ardonagh Group, if the scheme is implemented,” he says in the annual report.

PSC’s underlying net profit after tax and before amortisation grew to $87 million last financial year from $78.5 million the previous year, and underlying revenue increased 15.5% to $343.6 million.

Distribution, which includes Australian and New Zealand broking, reported a 15.2% increase in revenue, with underlying earnings before interest, tax, depreciation and amortisation (EBITDA) rising 12.4% to $63.4 million.

PSC says there was a good performance across Australian broking and increases in workers’ compensation consulting, while it was a year of consolidation for the network business.

Market conditions were described as mixed by policy class, with commercial softening and reduced premiums in some areas.

Agency revenue rose 11.9%, while earnings eased 6% to $12.2 million as the division started three new businesses – Chase Plant and Equipment, Chase Credit, and Chase Accident and Health.

UK and international revenue increased 17.5% and EBITDA increased 21.1% to $56 million.

Overall, PSC completed 14 acquisitions and deployed about $50 million in capital, with a focus on smaller, accretive opportunities. The pace slowed in the second half as the Ardonagh deal emerged.

A Federal Court hearing to approve the scheme is expected to be held on October 1 if shareholders vote in favour. October 2 would be the last day of trading in PSC shares, with the scheme implementation date scheduled for October 11.

From Insurance News magazine: Insurance Advisernet's founder and MD look back on the early days of the AR, and their unwavering commitment to the model