The Cover-More Group Ltd
(ASX:CVO) has entered a deal to buy a competing travel insurance company, Travelex Insurance Services Inc, for $138 million.
Cover-More says the Travelex will help accelerate its entry into the North American market and serve as a platform for further expansion.
The company also says that Travelex earned US$124 million in gross written premiums and US$9.5 million in EBITDA for the full-year ending 30 June 2016.
The acquisition is expected to complete by late this year. It will be funded by the combination of entitlement offer which aims to raise A$73.3 million, and the drawdown of a corporate bank debt facility of around $72.7 million.
Cover-More reported a net profit of $18.7 million at 30 June 2016.
