NN Group: Agreement to acquire majority stake in insurance broker Heinenoord

NN Group: Agreement to acquire majority stake in insurance broker Heinenoord

8 juli 2021

Verzekeraars Fusies & Overnames (M&A)
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NN Group (NN) announces it has reached an agreement with Qmulus Invest B.V. and AS Holding B.V. to acquire a 70% stake in insurance broker and service provider Heinenoord, for a total consideration of EUR 176 million. In addition, NN will refinance the outstanding debt granted to Heinenoord for an amount of EUR 129 million. The agreement includes an option structure to acquire the remaining 30% of shares by NN within four years, following the closing of the transaction.

Heinenoord is one of the largest insurance brokers and service providers in the Dutch insurance market, offering amongst others policy administration, underwriting services and claims handling. The company is growing rapidly in both revenues and margin, and is active as a broker and mandated agent for a wide variety of non-life insurance products and insurers, servicing both the SME and retail market.

Heinenoord is also a service provider for an extensive network of around 500 independent brokers. The company’s contribution to NN’s operating capital generation is expected to be approximately EUR 25 million per annum in 2023 and is expected to grow significantly in the coming years.

David Knibbe, CEO NN Group: ‘NN strongly believes in the future of the intermediary advisory market and the added value that broker advice has for customers. The vast majority of non-life distribution goes through the broker channel. The insurance market is rapidly changing with new customer propositions, consolidation in distribution, digitalisation, and the growing importance of mandated agents and service providers, which offer a broad range of insurance services.’

He continues:  ‘As Heinenoord plays an active role in the value chain between customers, traditional brokers and insurance companies, this acquisition will strengthen the distribution capabilities, and reinforce our leading position in the Dutch non-life market. NN is committed to continuing Heinenoord’s successful strategy to grow to a top 5 position in the Netherlands. Heinenoord will retain its independent position as a broker, and will remain dedicated to servicing its long-standing customer relationships and partnerships.’

At closing, NN will recognise a financial liability of approximately EUR 85 million in connection with the optional acquisition of the remaining 30% of shares. The transaction, including the option on the remaining shares, will have an expected negative impact on the NN Group Solvency II ratio of approximately 4%- points. The transaction has an envisaged high single digit return on investment, and will be funded from existing cash resources. NN’s dividend policy and share buyback programme will not be affected.

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