Heath Lambert wholesale deal hangs in the balance
Negotiations surrounding the sale of Heath Lambert’s wholesale division to Cooper Gay were delivered another blow last week after it emerged that a major unit in the transfer will no longer be a part of the proposed deal.
Sources have told the The Insurance Insider that, Heath Lambert CEO Adrian Colosso has withdrawn the Global Business Solutions (GBS) unit, headed by Martin Emkes, from the proposed sale which was announced earlier this month.
The removal of GBS – which has revenues of around £6mn – follows objections from major executives within the business.
Emkes was one of the first to object to the transfer, which is statutorily required under Transfer of Undertakings Protection of Employment Regulations (TUPE) employee consultation, and governs staff rights when assets are sold from one company to another.
However, The Insurance Insider understands that around nine objections have now been made, as well as at least one resignation, in protest at the proposed sale by Heath Lambert wholesale executives.
GBS provided almost half of the wholesale revenues that were due to be transferred to Cooper Gay, with general London market wholesale business FSJ, aviation and reinsurance providing the remainder. Absent any further objections, the remaining units are due to be transferred by the end of this week, according to sources.
Speaking to The Insurance Insider last week, Cooper Gay CEO, Toby Esser, said: “We intend to do a deal. It is dependent on people joining. We don’t know what the deal will look like but we are confident that a deal will be done.”
But he said that the proposal could be endangered if enough staff did not decide to transfer.
“Obviously we would have to think again if many people decided not to join,” Esser said.
Cooper Gay was thought to have agreed an initial fee of around £8mn for the businesses before the recent developments. The wholesale and international reinsurance broker has had talks with stockbroker Collins Stewart with a view to undertaking an initial public offering within the next 18 months to ensure that its largest outside shareholder, the Portuguese conglomerate Sonae, has an exit route.
A Heath Lambert spokesman declined to comment on the latest move.