Trans Tasman insurer Tower says its proposed demerger – which will separate the NZ and Australian operations – will result in higher profits.

Tower says it expects net profit to rise more than 50% this financial year as it plans to raise $160 million from shareholders. It also expects a full-year net profit of about $NZ61.7 million ($54 million) for the 12 months to September 30.

Documents lodged with the Australian Securities and Investments Commission (ASIC) last week indicate the newly created Australian arm, Tower Australia Group, will debut on the Australian Stock Exchange (ASX) on November 21.

Tower CEO Jim Minto says that for a short time Tower Australia Group and the NZ half of the business, which retains the Tower Limited name, will trade on the ASX.

Mr Minto says the proposed geographic separation of Tower’s businesses is proceeding smoothly and a special general meeting of shareholders will be held in Wellington early in November.