The Ardonagh Group and Markerstudy Group have agreed a merger deal between Markerstudy and Atlanta Group - Ardonagh's personal lines broking business - to create a major new player in the UK insurance market.
Ardonagh said the combined business will provide a wide range of insurance products, including home and motor insurance, and will employ around 7,300 people across the UK.
The new company will transact over £3 billion in annual Gross Written Premium (GWP).
The transaction is subject to customary conditions - including regulatory approvals.
It values Atlanta at £1.2 billion and will be funded by a new investment led by Pollen Street Capital and Bain Capital Special Situations.
Under the terms of the deal, Ardonagh and its related parties will receive a combination of cash and a substantial minority equity stake in the combined business, as well as two seats on the board of directors of the combined business.
Key Atlanta executives including Ian Donaldson, Craig Ball and Emma Rawlinson will join the Markerstudy management team as senior executives of the combined group.
With a workforce over over 2,100 across 12 locations, Atlanta manages about £1 billion of GWP on behalf of 2.6 million customers.
It distributes a broad suite of products through household insurance brands including Swinton, van specialist Autonet and motorcycle experts Carole Nash.
Markerstudy offers omni-channel distribution and a broad product proposition to about six million customers across motor, pet, home and commercial - particularly SMEs.
It has more than 5,200 workers, across 19 sites, and reported GWP of £2 billion in 2022.
David Ross, the CEO of The Ardonagh Group, said the company's strategy has always been to find and empower strong management teams, and to back their ambitions with a clear and relentless focus on equity value creation.
"This combination with Markerstudy is an important step in the Atlanta journey, and presents compelling opportunities for its customers and people," Mr Ross said.
"We are very proud of what the Atlanta team have achieved since joining our group in 2017 and look forward to continuing to work with Kevin, Ian and our new partners at Pollen Street to create a major new player in the UK insurance market," he added.
Ardonagh Group is the UK's largest independent insurance broker, with 100 locations and a workforce of 7,000.
In July 2020 it completed its takeover of Ireland-based Arachas.
The deal was one of a large number in recent years driven by consolidation in the Irish insurance sector.
