Western Financial Group Announces Acquisition of Manitoba's Largest Insurance Broker
For Immediate Release
High River, Alberta – September 8, 2009 (TSX – WES). Western Financial Group (”the Company” or “Western”) announced today that it has agreed to acquire all issued and outstanding shares of Winnipeg based Hayhurst Elias Dudek Inc. (“HED”) and its subsidiaries, including Securican General Insurance Company (“Securican”). The transaction has been approved by all applicable regulatory bodies and is scheduled to close on or before September 30, 2009. The Company, which currently owns 49% of HED, had been a minority shareholder for almost 3 years.
HED is one of Canada’s largest independent insurance brokerages, with its Head Office in Winnipeg and a service office in Laval, Quebec. HED specializes in progressive and unique commercial insurance and employee benefit products specifically designed for Canadian independent businesses and Government entities that are aligned with associations or buying groups. Securican is Canada’s largest and most profitable underwriter of pet health insurance through its own brand name – PetSecure – as well as a number of white label agreements with national brand name companies. It also plays a supporting role in the placement and management of HED’s commercial “Protected Self-Insurance” programs.
“With the acquisition of HED and Securican, we have a powerful set of resources in place to continue the systematic growth of our business. We are one of only a few Canadian organizations operating in the banking, life, and property and casualty manufacturing insurance sectors. In addition, we own and operate the largest insurance network of brokerages – now more than 100 locations – in Western Canada,” said Scott Tannas, President and CEO of the Company. “There are many reasons why I am particularly excited about the strengths of our combined operations, and these include:
Providing our company with a unique and powerful platform on which to expand its sales of commercial insurance in the West.
While Western’s focus has been in the West, we welcome and embrace HED’s cross-Canada business model of serving client group member firms’ needs across the country including not only the West, Ontario and Quebec, but reaching all the way to Atlantic Canada.
Unleashing HED’s employee benefit sales methodology toward all Western’s existing small business customers.
We intend to make Securican a platform for future development of a roster of specialty insurance products that could be marketed by Western’s distribution force. That said, our policy of acting as only brokers in our core home, auto and small business insurance business has not changed.
Securican operates a 50 seat call centre that currently supports the sale and service of pet health insurance to its 60,000+ policy holders across Canada. This call centre and its licensed personnel provide Western with expert staff and an infrastructure on which to build future sales and service initiatives encompassing home, auto and life insurance.
Winnipeg will become the focal point for after-hours care for our existing branch customers, as well as the hub of our long-term plan to expand into the sale of insurance by telephone and through the internet to new customers in the West, including those in metropolitan centres.
HED and Securican have a history of solid profitability, and should therefore be accretive to shareholders.
Western and HED recently developed significant profit and sales momentum on cross sales between business units, particularly between Western Life and HED.
HED is a top Canadian performer and has been recognized repeatedly as one of the best employers in Manitoba, as well as in the top 100 in Western Canada. With HED on board, we also become a significant employer in Winnipeg, with over 300 on the payroll, meaning greater employment advancement opportunity for staff at all our businesses,” he said.
Western Financial Group is a leader in providing insurance, financial services and banking services in over 90 communities, to more than 500,000 individuals and businesses in Western Canada through its Network locations, its affiliated insurance brokers, Western Life Assurance Company and Bank West.
The Company in its second quarter report released on August 13, 2009 reported an overall increase of 538% in net income over the first quarter operations.
The Common Shares of Western Financial Group are traded on the Toronto Stock Exchange under the symbol “WES”.
This press release is not for distribution to any United States news service or otherwise in the United States.
This press release contains information that constitutes "forward-looking information" or "forward-looking statements" (collectively "forward-looking information") within the meaning of applicable securities legislation. This forward-looking information includes, among others, statements regarding: the timing of completion of the offering and other expectations, beliefs, plans, goals, objectives, assumptions, information and statements about possible future events.
This forward looking information is based on various assumptions, including without limitation, the ability to complete the offering and the size of the offering. Undue reliance should not be placed on forward-looking information. Forward-looking information is based on current expectations, estimates and projections that involve a number of risks which could cause actual results to vary and in some instances to differ materially from those anticipated by the Company and described in the forward-looking information contained in this press release. The material risk factors include, but are not limited to, uncertainties as to changes in capital markets and the abilities of the parties to complete the transaction generally.
Forward-looking information is based on the estimates and opinions of the Company’s management at the time the information is presented. The Company assumes no obligation to update forward-looking information should circumstances or management’s estimates or opinions change, except as required by law.
For further information, please contact:
Arlene Beggs, Assistant to the President
Western Financial Group