Hub To Purchase Near North
By Mark E. Ruquet
NU Online News Service, July 25, 3:42 p.m. EDT – Chicago-based insurance broker Hub International Ltd. announced today that it plans to purchase the scandal-wracked Near North National Group of Chicago.
According to a company statement, Hub said it has signed a proposal to purchase "all of the brokerage operation assets, primarily insurance relationships with customers and insurers."
Terms of the transaction were not released, but the firm did say it would disclose the terms after a definitive agreement is signed. Hub said that the total purchase price would be paid based on future revenues.
The deal is subject to further due diligence, negotiation and execution of a definitive agreement, and customary regulatory approvals and conditions, the firm said.
In a statement, Martin P. Hughes, Hub chairman and chief executive officer, said officials are working to complete the deal "in a timely manner."
Fred Foreman, chairman of the board of Near North said in a statement that the firm feels "very positive about aligning itself with Hub International." He added that Near North management, employees and insurance partners are supportive of the acquisition.
In June, Near North announced that Frontenac Company LLC, a Chicago-based private equity firm, entered into a binding agreement to purchase portions of the firm. A spokesperson with Hub said the Hub deal is separate from the Frontenac sale.
On June 12, Near North was indicted by a federal grand jury in the Northern District of Illinois on fraud and racketeering charges.
The charges stem from the arrest in January of Michael Segal, the company's founder and former head, for allegedly misappropriating millions of dollars from the firm's premium trust fund account over a 12-year period for his own and company use, ranging from $5 million in 1990 to $24 million by 2001.
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