THE insurance market will see some jostling for pole position following the €65 million acquisition by RSA Insurance of 123 Money.
Competitors like VHI, Aviva and AXA looked on with interest as RSA’s purchase gave it a larger footprint in the market. Already a major player globally, with 23,000 employees serving 20 million customers, RSA’s acquisition ensures its Irish online and call centre services are now comparable to its other global operations.
This €65m sale is the second major sale for 123’s CEO, Andrew Collins, who in 2006 was said to have made around €20m for his 35% stake in Needahotel.com, bought by Cendant for a reported €60m.
Mr Collins said: “We are delighted to join such a strong global and local business as RSA. RSA’s professionalism and record of delivery in the general insurance market is second to none. Our combined strengths will directly support 123.ie’s continued expansion in the interests of our staff and rapidly growing customer base.”
RSA also sees this acquisition as a marriage of interests. 123.ie will continue to operate under its own brand.
123.ie has a consumer base of around 170,000 policyholders and generated premium income of €60m to the year ended March 31, 2010, primarily via motor, home, pet and travel insurance sales.
This is RSA’s fourth local acquisition in as many years. RSA has been growing steadily in recent years. Despite the worldwide recession, its net written premiums for 2009 totalled £6.7 billion (€8bn).
RSA marketing director Pat Nally said: “RSA is already a very strong player in the Irish market, but this extends our reach. The deal is subject to the standard regulatory approval. As well as the €65m consideration, there are additional monies depending on performance.
“This acquisition helps accelerate our ambitions through 123’s strong web and call centre presence. We are hoping to bring our strong global experience in these areas to 123, and vice versa, to capitalise on their strengths. The move makes perfect sense to both companies.”
This view was echoed by RSA Insurance Ireland chief executive Philip Smith, who said: “This very positive development accelerates our strategic objective to build on our major presence in the market and to continue to deliver sustainable, profitable growth. We are excited about the development prospects created by combining 123.ie’s strong brand with RSA’s financial strength and recognised technical expertise.”
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