New Zealand investment and financial services group Pyne Gould Corporation (PGC) will sell half its share of Marac Insurance to the Automobile Association (AA) under a new joint venture agreement.

The deal, which will provide a one-off gain of $NZ2.2 million ($1.7 million) for Pyne Group, will allow AA members to purchase Marac insurance products and is subject to a five-year exclusivity deal.

AA has been running its own joint venture insurance operation with GIO Australia since 1994.

PGC Chief Executive Jeff Greenslade says the Marac deal opens new opportunities for the group, and both companies share similar ground.

“The joint venture is an exciting development that gives us the ability to tap into AA’s

substantial distribution network and membership base totalling more than one million,” he said.

“The AA’s members have virtually the same demographic as our target market. With 38 AA branches… this gives us a bank-like distribution network and fits with our strategy to become a niche bank.”