It's been a busy day for leading insurance broker Steadfast Group Ltd (ASX: SDF) with the company entering a trading halt, announcing a capital raising and multiple acquisitions and releasing its interim financial results for the half year ended 31 December 2014.
Here's what investors need to know:
- Steadfast is in a trading halt which is expected to last until the morning of Wednesday 18 February.
- The company is looking to raise approximately $300 million via an $89 million institutional placement, and a fully underwritten $211 million 1-for-3 pro-rata non-renounceable entitlement offer at $1.26 per share.
- The broker has entered an agreement to acquire from QBE Insurance Group Ltd (ASX: QBE) the Australian and New Zealand underwriting agency businesses known as CHU Underwriting Agencies and Underwriting Agencies of Australia alongside insurance broker Body Corporate Brokers. The total cost is between $232 million and $348 million depending on the final price of the earn-out.
- Separately, Steadfast is also acquiring a founding member broker business IC Frith.
- For the half, Gross Written Premium grew 6.1% to $2.1 billion.
- Steadfast's adjusted cash earnings per share for the half year increased by 11.5% to 4.18 cents per share.
- The group is set to pay a fully franked interim dividend of 2 cents per share with an ex-dividend date of 19 February 2015 and a payment date of 14 April 2015.
- Management has revised its guidance for the full year up from a previous range of between 10% and 13% to between 22% and 25%. Importantly, this guidance excludes the recently completed Calliden acquisition and the acquisitions announced today which should ultimately provide further earnings per share accretion for shareholders.
