Australia-based Wesfarmers Insurance has signed an agreement for its New Zealand-based business unit Crombie Lockwood to acquire the Fraser Macandrew Ryan (FMR Risk).

The combination of FMR Risk and Crombie Lockwood is expected to create a leading insurance broking and risk consulting business in New Zealand and will establish Crombie Lockwood as the leading provider in the industry.

The Australian insurer also invited FMR’ CEO Paul Meehan to join the board of Crombie Lockwood.

Wesfarmers Insurance managing director Rob Scott said this transaction confirms the commitment to the New Zealand market and further strengthens broking operations across Australia, New Zealand and the United Kingdom.

"The acquisition will also enhance our return on capital from the first year," Scott said.

Crombie Lockwood CEO Carl O’Shea said this acquisition is consistent with the strategy to accelerate growth with a focus on delivering customer value.

"FMR Risk has extensive relationships and specialist services that build on our current capabilities and propels us into a market leading position.

"Crombie Lockwood is committed to combining the two operations into a prestigious, scalable business that enhances our delivery and innovative offerings to new and existing clients," O’Shea said.

The transaction is expected to complete in April 2011.