Hibernian General Insurance has purchased the general insurance book of the Friends First Group bringing its share of the Irish non-life assurance market to 26 per cent.
The acquisition, which includes Friends First's general insurance headquarters in Galway, was completed for around £6 million (€7.6 million).
Friends First was a very small player in the general insurance sector with a market share of around 1.5 per cent. It currently has 66,000 motor insurance policy holders and 27,000 home insurance customers but did run into difficulties some years ago. Under the terms of the deal, more than 100 Friends First staff who are predominantly based in Galway, will transfer to Hibernian which is part of the CGNU group formed through the merger of CGU and Norwich Union. Announcing the deal yesterday, Mr Pat McGorrian, chief executive of the Hibernian group, said the acquisition was further evidence of the ambition of the new company and the willingness of its parent to provide capital to support that ambition.
"It consolidates our leading position in the general insurance market and gives us a significant regional servicing centre, enhancing our service to brokers and customers," he said.
The company now has the biggest share of the Irish general insurance market ahead of AXA which has a stake of around 20 per cent.
The sale was completed following a review of operations at Friends First.
Its managing director, Mr Adrian Hegarty, said the strategic review had confirmed that prospects for growth in the general insurance market were limited.
"The review indicated the best option to ensure the continuity and ongoing development of the business was to dispose of it as a going concern."
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