AUB Group to Buy UK’s Prestige for £219M, Launches A$400M Raise and Reaffirms FY26 Guidance

Posted by Defense World Staff on Jan 28th, 2026

AUB Group (ASX:AUB) Chief Executive Officer and Managing Director Mike Emmett told investors the company has agreed to acquire UK-based Prestige Insurance Holdings for £219 million (A$432 million), describing the deal as a strategic fit that accelerates AUB’s growth and margin plans in the UK and its international division.

Prestige acquisition: price, business mix, and timetable

Emmett said the transaction values Prestige at an EBITDA multiple of 12.9x before cost synergies. Prestige was established in 1973 in Belfast and has built a portfolio of businesses across the UK and Ireland, including retail brokerages, underwriting agencies, and an insurtech platform.

According to Emmett, Prestige places more than £300 million of premium and generated EBITDA of £17.5 million in calendar year 2025, with a margin of about 30%. He said Prestige is led by CEO Trevor Shaw and an experienced team, and management will continue to drive the business.

The deal remains subject to UK Financial Conduct Authority approval. Emmett said AUB expects completion “most likely” in the fourth quarter of fiscal year 2026.

Funding package: equity raise and higher debt capacity

To fund the Prestige acquisition alongside accelerated equity step-ups in existing investments, AUB is increasing its debt facility by A$200 million and launching an underwritten A$400 million institutional placement at A$29.40 per share. A non-underwritten share purchase plan will be offered to eligible shareholders.

Emmett said the company chose to raise more funding than required for the Prestige investment alone in order to retain flexibility for additional step-ups “likely to arise later in calendar year 2026.” On a pro forma basis after the Prestige transaction, step-up investments, the capital raising, and the debt facility increase, AUB expects leverage of approximately 2.47x and about A$303 million of cash and undrawn debt available.

Emmett said management is comfortable with the higher leverage, citing AUB’s track record of earnings growth and cash generation and expecting “natural deleveraging over time.” He also said the Prestige investment and the step-ups are expected to be EPS-neutral pre-synergies and low- to mid-single-digit EPS accretive post-synergies for calendar year 2025 on a pro forma basis. He added that surplus cash and debt headroom from the equity raise could contribute to additional EPS accretion as funds are deployed.

First-half FY2026 performance and reaffirmed guidance

Emmett said AUB expects first-half fiscal 2026 underlying net profit after tax (unaudited preliminary) of A$90 million to A$91 million, representing growth of 13.4% to 14.7% versus the prior comparable period. He noted the result came despite “meaningful” foreign exchange headwinds.

He quantified two FX impacts: on a constant-currency basis using first-half FY2025 rates, underlying NPAT would have been A$2.2 million higher, and the benefit from FX hedges declined by approximately A$1.8 million versus the prior year half as hedge contracts matured and repriced at lower spot rates.

By division, Emmett said:

Australian broking delivered a solid performance despite reduced interest income and “challenging and highly competitive” conditions in the large and corporate segment.
Underwriting agencies had another strong half, though strata agencies struggled as competitors continued to significantly reduce rates.
The international division performed well, with margin improvement initiatives beginning to deliver “tangible benefits,” and momentum emerging from newly seeded businesses.
BizCover delivered “robust” organic top-line growth and margin expansion locally and offshore.
New Zealand underperformed expectations, which Emmett attributed to weakness in the corporate market and market-share initiatives that “have not delivered satisfactorily.”

AUB reaffirmed full-year fiscal 2026 underlying NPAT guidance of A$215 million to A$227 million, which Emmett emphasized is before the impact of the Prestige acquisition and step-up investments. He said step-ups were already planned for FY2026 but were brought forward into the first half.

Impairments and accounting context

Emmett also highlighted impairments recorded in the first half of FY2026, including approximately A$39 million relating to an Australian corporate-focused brokerage and a further A$30 million tied to historical items linked to early calendar year 2025. He said the impairments related to the carrying value of broker registers and goodwill assessments.

In Q&A, Emmett said the A$39 million impairment largely reflected the accounting treatment of broker register amortization and the write-off of carrying values when clients leave, adding that in the cited corporate business it related to the loss of one client. He also referenced a lagged effect in Tysers connected to previously discussed team departures. He noted total broking register and goodwill intangibles are about A$2.5 billion, framing the impairment as a small portion of that balance.

UK strategy and expected synergies

Emmett said AUB has spent the past 18 months separating Tysers retail and technology functions to prepare for a UK retail expansion, and argued that without an acquisition like Prestige in the first half of calendar 2026, AUB risked missing opportunities it had prepared for.

He said AUB’s UK retail broking portfolio post-Prestige (excluding MGAs) would place close to £550 million in premium, with teams across more than 200 locations. The underwriting agency portfolio would write £180 million of premium.

On synergies, Emmett said AUB has only quantified cost-out opportunities so far, expected to exceed A$10 million by the end of FY2027 on a run-rate basis, while revenue synergies remain unquantified due to uncertainty. He outlined synergy areas including optimizing middle and back office support between Tysers retail and wholesale, rationalizing overlapping functions, leveraging capabilities across geographies, improving commercial arrangements with industry partners through greater scale, enhancing business flow across an expanded MGA portfolio, and using Tysers wholesale to place retail MGA binders and risks into Lloyd’s.

In response to analyst questions, Emmett said Prestige has demonstrated “high single-digit growth over the medium term” and has been growing in commercial and specialty segments while reducing exposure to personal lines. He also said Prestige’s margin has been “pretty consistently” around 30%.