Canada’s property and casualty insurance provider Intact Financial (IFC) has purchased specialty and niche insurance provider JEVCO Insurance, a wholly owned subsidiary of The Westaim Corporation, in a $530m deal.

The deal and transaction-related expenses have been financed with the proceeds from a $237m subscription receipt issuance, a medium term note offering and a portion of IFC’s excess capital.

The acquisition will enable IFC to establish a foothold in the insurance arena by obtaining more than $350m in direct premiums on a pro forma basis, while boosting its market share to 17%.

The deal will add more commercial insurance products offered by IFC that include recreational vehicles insurance, such as motorcycles, snowmobiles and all-terrain vehicles, as well as commercial, surety and non-standard auto insurance.

Intact Financial chief executive officer Charles Brindamour said, "The acquisition provides us with another opportunity to reinforce our commitment to the broker channel, enrich our customer value proposition and enhance our competitive position."

It is anticipated that the deal will produce an internal rate of return (IRR) above 20%, to be accretive to net operating income per share beginning in 2013 and to increase book value per share by 2.6%.

Intact Financial provides home, auto and business insurance through Intact Insurance, belairdirect, Grey Power, BrokerLink and JEVCO Insurance.