PSC Insurance Group closely examined the Griffiths Goodall broking operations before it decided to acquire the business, and it isn’t concerned by any issues related to an Australian Securities and Investments Commission (ASIC) raid earlier this year.

PSC MD Tony Robinson says the acquisition of the Victorian regional broker was completed “after a lot of due diligence”.

“We spent a lot of time with [the Griffiths Goodall management team] and we are really comfortable that it is a well-run business full of capable people with a terrific client base,” he told insuranceNEWS.com.au today.

As reported in a Breaking News bulletin earlier today, PSC will pay $48 million for the Shepparton-based business, with the deal expected to close this month.

PSC is buying the assets of the broking firm and not the corporate entity, which would leave ASIC free to continue any matters with the licence-holder during the period they are investigating.

insuranceNEWS.com.au reported in May that Griffiths Goodall was “undertaking a review of its structure” and exploring options including a sale of the business. It is understood this resulted in approaches from a number of broking companies, including a major international.

Mr Robinson says the fact that a group of experienced brokers examined the company in detail and then tried to acquire it “supports our view that this is a well-run business. We (PSC) are very comfortable [Griffiths Goodall] operate within the law and within the spirit of the law.”

Griffiths Goodall, established in 1989, has become one of the largest regional independent insurance brokers, although much of its business is generated outside its Goulburn Valley base market. It has more than 30 staff, an additional office in Melbourne and a strong presence in commercial, industrial, transport, logistics, pleasurecraft, agri-risk and personal insurance.

Mr Robinson says Griffiths Goodall’s branding will remain prominent, following the PSC practice where a firm with a strong identity has been purchased.

“If it has got great resonance with the customer, we don’t look to make changes,” he said.

The purchase price will be paid in three tranches. The first tranche, comprising $28.8 million in cash and $9.6 million in PSC shares, is due on completion of the deal. The remainder will be split between payments in the first half of fiscal 2021 and in the following year, and will depend on revenues.

Griffiths Goodall’s key managers will continue to oversee day-to-day operations and all staff will be offered new employment agreements.

Director Benjamin Goodall said in a statement today that he and all the existing directors “will be remaining in the business to grow and enhance our client offerings”.

ASIC and Australian Federal Police officers arrived at the Griffiths Goodall Shepparton offices in March with search warrants and seized a number of files.

An ASIC spokesman today said the regulator was “unable to discuss the progress of any investigation we might undertake”.

Mr Goodall has previously said the issue being investigated by ASIC did not relate to theft or anything else of a criminal nature, with discussion focused on a paperwork-based issue that was denied.

“We’re very confident that we have always operated within the law,” he said at that time.