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LONDON (Reuters) - RSA (RSA.L), Britain's biggest commercial insurer, has agreed to buy Canada's L'Union Canadienne for 94 million pounds ($144.48 million), more than doubling its share of the lucrative Quebec market.
"Our group strategy is to drive continued growth and strong profitability in our overseas markets," RSA chief executive Simon Lee said in a statement.
RSA, Canada's third-largest general insurer after its $425 million takeover of GCAN in 2010, is looking for small acquisitions to drive growth outside its home market but is not interested in big deals that would require external fundraising, Lee told Reuters in April.
The insurer, best-known in Britain for its More Than home and motor insurance brand, has a track record of small-scale takeovers, completing 50 acquisitions between 2005 and the end of 2011.
"To us, this is a classic RSA bolt-on acquisition," Shore Capital analyst Eamonn Holmes said of the L'Union Canadienne deal. "Small enough to be paid for in cash, big enough to make a difference, we envisage L'Union Canadienne becoming a valuable element of RSA's presence in Canada."
RSA shares were 2.1 percent higher by 10:07 a.m. EDT (1407 GMT), outperforming a 1.9 percent rise in the FTSE 100 share index .FTSE.
L'Union Canadienne, part of Canada's Co-operators General Insurance Company CCS_pc.TO, had net written premiums of 169 million pounds last year, RSA said.
Reporting by Myles Neligan; Editing by Erica Billingham and David Goodman