Wesfarmers Limited (ASX:WES) has agreed to sell its insurance broking and premium funding operations. The conglomerate will sell the operations to subsidiaries of American broking giant Arthur J Gallagher for $1.01 billion.
Wesfarmers says it will also receive a distribution of about $150 million to repay funding of the premium funding operations. Once the transaction is tied up the company expects to book a pre-tax profit of between $310 million to $355 million.
Wesfarmers has noted the sale is still subject to a number of conditions including clearance from Australia's Foreign Investment Review Board and United Kingdom and New Zealand regulators.
The news comes after Insurance Australia Group Limited
(ASX:IAG) last month scored clearance from Australia’s competition regulator to buy
Wesfarmers Australian insurance underwriting business for $1.84 billion.
Wesfarmers boosted its net profit by 11 per cent to $1.4 billion in the first half of the 2014 financial year.
