The Manchester office of Cobbetts LLP has advised high street insurer, Swinton Group, on its £50 million acquisition of Equity Insurance Group, after securing a £175 million refinancing deal from Lloyds TSB.

The deal will seal Manchester-based Swinton’s position as the UK’s largest insurance retailer, boosting its nationwide branch network to 580 and securing a 5,000-strong workforce throughout the UK.

This year, Swinton announced its seventh consecutive year of growth with record profits of £48.3 million.

Funding for the takeover of Equity, which was bought from Insurance Australia Group, a fully listed company on the Australian Stock Exchange, was financed as part of a £175 million package from Lloyds TSB.

Equity’s sale comes as part of Insurance Australia Group’s decision to pull out of the mass market insurance distribution in the UK.

Paul Johnson and Adam Kaucher led the deal team for Cobbetts on the acquisition of Equity.  Paul Brown, also of Cobbetts, advised Swinton on its refinancing deal with Lloyds TSB. 

Paul Johnson commented: “Many companies in the insurance industry are slashing costs by driving customers to overseas call centres, as opposed to focusing on in store service. That said, Swinton’s takeover of Equity means it can broaden its branch network to improve its customer offering, highlighting its commitment to providing the highest quality customer care it can.

“It is equally exciting to see such a high profile deal securing finance and completing in what has been an extremely difficult time for many in the corporate area. This deal is proof that there is money available for the right type of transaction.”

Patrick Smith, chief executive of Swinton, said: “This deal is not about reducing staff numbers to increase margins, it is about providing great customer service to local communities.  The acquisition of the Equity shops cements our position as the leading high street insurance retailer, but our success is due to our multi-channel retailing capability.”

Picture Caption: Paul Johnson, Cobbetts