About the Issuer
Established in 2000 and previously known as Avea
Insurance, Eric is a privately owned underwriter of
insurance products that are predominately related to the
sale of new and used motor vehicles and motor vehicle
finance. Eric sell a range of motor insurance-related
products classed as either asset protection or personal
protection products, and at the time of issuance was the
3rd-largest competitor in the market behind Allianz and
Swann.
The issuer need
Eric operated a distribution network of independent
motor vehicle dealerships and finance and insurance
brokers to sell policies and was seeking to grow and
diversify its distribution business model by acquiring a
competitor’s Motor Vehicle Insurance business. This was in
turn supported by its own existing internal sales team and
established dealer network. Up until this point, Eric had
benefitted from a lower cost base, however found limited
opportunities to grow the network further through organic
means. The increased business scale would enable Eric to
penetrate large factory and franchise dealerships with a
broader product offering and lower the cost per policy
through improved operating leverage.
The FIIG solution
Eric was able to work closely with FIIG to issue a Tier 2
Capital Note into the capital markets. The terms and
structure of the notes were supportive to Eric’s
requirements and able to be included as regulatory capital
with adhering to APRA’s requirements. The issue was
viewed favourably by FIIG’s distribution network and was
well oversubscribed.
Client testimonial
Eric CEO David Pemberton, who joined the company in
2009, was a senior manager at Swann Insurance between
1990 and 2002. “The acquisition fast-tracks our strategic
ambitions, allowing us to have a more extensive network
with car dealers and finance brokers”, he said. “We are
very happy with the financing solution arranged by FIIG
Securities enabling us to complete the acquisition”.