PSC Insurance Group will acquire the broking business of Alliance Insurance Broking Services, which is selling the operations as part of undertakings it gave to the Federal Court, for $24.5 million.

Alliance gave the undertakings - which includes appointing an independent agent to sell the business - after the Australian Securities and Investments Commission (ASIC) obtained urgent interim asset freezing orders in the court against it and its sole director Renato De Maria.

PSC says its acquisition of the insurance broking portfolio and other key business assets trading as Alliance Insurance is subject to a number of customary conditions and expects the purchase to close within the next four weeks.

The addition of Alliance Insurance is forecast to generate more than $3 million in incremental earnings before interest, taxes, depreciation, and amortisation in its first 12 months of becoming part of the PSC business, the Melbourne-based group said in a statement.

Group MD Tony Robinson says he is delighted with the acquisition and what it will bring to the PSC business.

“We think that it’s got some terrific people and terrific clients and we’re comfortable that they will be a good fit with PSC both at the client end and the people end,” Mr Robinson told insuranceNEWS.com.au today. “That’s what will help us to grow and prosper.

“We’re buying the goodwill, the assets and the relationships with the clients and the people that work in the business.”

PSC will pay for the acquisition in three tranches. The first will comprise an $18.4 million cash payment upon completion of the transaction.

In the second tranche, a $3.07 million cash payment is payable within 90 days following the first anniversary of completion of the purchase. The amount is subject to a rise and fall adjustment dependent on the revenue of Alliance during the 12-month period post completion.

For the final tranche, another $3.07 million is payable in cash within 90 days of the second anniversary of the acquisition. The amount is subject to a rise and fall adjustment dependent on the revenue of Alliance during the 12-month period post the first anniversary of completion.