Suncorp has sold its 50% stake in Royal Automobile Club (Western Australia) Insurance after the Promina merger gave RAC-WA the green light to reclaim full ownership of the division.

A change of control clause in the joint venture between RAC-WA and Promina was triggered when Suncorp acquired Promina in March last year. Both RAC-WA and Suncorp then agreed to postpone the move for 12 months.

Promina paid almost $100 million in 2001 to acquire 50% of the RAC-WA’s insurance division. The business is the largest personal lines insurer in WA.

Suncorp has not disclosed the price RAC-WA paid to reclaim full control of its insurance business, but media reports suggest the division could now be worth up to $500 million, based on turnover. Suncorp CEO John Mulcahy has said only that the parties agreed a “fair value”. The 50% stake owned by RAC-WA currently contributes about half of the Perth-based association’s group revenue.

Suncorp spokesman Jamin Smith told insuranceNEWS.com.au the deal has no implications for the remaining Suncorp joint ventures with the Royal Automobile Association (RAA) and the Royal Automobile Club of Queensland (RACQ).

“They are ‘heritage’ joint ventures on the Suncorp side so they are not affected by this transaction,” he said.