The PSC Insurance Group Ltd (ASX: PSI) share price is on the rise, up 3.6% in morning trade. This comes after the company reported it has entered into agreements to acquire 2 commercial broking businesses based in the United Kingdom. At the time of writing, the PSC Insurance share price has retreated slightly to $3.35, up 2.1%.
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What did PSC Insurance report on its UK acquisitions?
The PSC Insurance share price is gaining in morning trade after it reported it had entered into an agreement to acquire 100% of the share capital of Trust Insurance Services Ltd. Exclusive of net assets, the base consideration for the acquisition is around 15.5 million pounds (AU$28 million).
The base consideration for PSC's second acquisition, 100% of the share capital of Abaco Insurance Brokers Ltd, is 21 million pounds (AU$38 million). That figure is also exclusive of net assets.
Management commentary
Commenting on the 2 acquisitions, PSC's Managing Director, Tony Robinson said:
These acquisitions are consistent with our goal of building a significant presence in the commercial broking market outside of London. It is an area we understand and believe we can help drive growth. Both businesses are excellent inclusions into PSC bringing both great people into the Group and generating strong returns…
Both businesses have strong expertise in particular areas that we believe we can help grow and that will benefit the wider PSC Group.
PSC forecasts that the 2 acquisitions together will deliver roughly 4.0 million pounds (AU$7.2 million) in earnings before interest, taxes, depreciation and amortisation (EBITDA) annually.
Share price snapshot
PSC's shares lost 36% during the wider COVID-fuelled market selloff last February and March. Since the 15 March lows, shares have rebounded 56%. Over the past 12 months, the PSC Insurance share price is up 8%. That is right in line with the 8% gain on the All Ordinaries Index (ASX: XAO).
So far in 2021, the PSC Insurance share price is up 13%.
