Following an initial investment in the Insurance Company of Prince Edward Island (ICPEI) in December 2022, Desjardins Group has now announced that it has completed the acquisition of all issued and outstanding shares of the insurer.
The transaction was announced on Wednesday, March 27. The purchase was made through Desjardins General Insurance Group (DGIG), and ICPEI will become its wholly owned subsidiary.
By exercising its call option ahead of schedule, Desjardins adds the home, auto, and commercial insurance activities of ICPEI to its operations. When its minority stake became effective in February 2023, DGIG expressed its interest in acquiring ICPEI in full, over a 3 to 5-year horizon.
“This acquisition will enable the organization to diversify its insurance offer and better meet the needs of small and medium-sized businesses in Canada. Given the solid expertise within ICPEI and its network of brokers, the company is an ideal partner to help Desjardins serve these clients more effectively,” says the acquirer.
The transaction is subject to regulatory approvals and other customary closing conditions.
A return to brokerage
At the end of 2023, Desjardins Group told our French-language sister publication, the Portail de l’assurance, that it is making a return to brokerage distribution. “Commercial insurance products will be offered through insurance brokers who work with ICPEI, as a complement to Desjardins Group's direct channel and network of exclusive agents,” the Group states.
According to Guy Cormier, president and CEO of Desjardins Group, “With this acquisition, we're strengthening Desjardins' position in the Canadian commercial insurance market…We're very pleased to be able to count on ICPEI's expertise in brokerage distribution of commercial insurance to expand our reach and access new markets,” adds Mr. Cormier.
For his part, Serge Lavoie, president and CEO of ICPEI, stated that “this acquisition is clearly in line with ICPEI's strategic goals to expand insurance distribution across the country and pave the way for even greater collaborations on the Canadian market. Desjardins is a strong financial leader, and this partnership will accelerate our growth to become a major player in insurance distribution with brokers."
According to Desjardins, the recent acquisition of Guardian Capital Group's life insurance and individual savings distribution activities, as well as that of ICPEI, demonstrate the financial institution's desire “to grow across Canada, particularly in the areas of property and casualty insurance, life and health insurance, and wealth management.”