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Old National Bancorp selling insurance unit for $93M

Prime Risk Partners is buying Old National Bancorp's insurance subsidiary, ONBInsurance Group Inc., for $93.0 million in cash.

The purchase price is subject to adjustments.

ONB Insurance Group does business as Old NationalInsurance. The deal is expected to close in the second quarter, andthe firm will take on the name ONI Risk Partners. Old National Insurance's chairmanand CEO, Tom Flynn, will remain with ONI Risk Partners.

The sale includes Old National Insurance's twothird-party administrator subsidiaries, Employee Plans LLC and JWF Specialty.

Old National Bancorp expects to recognize an after-taxgain in the range of about $16 million to $18 million. The deal will eliminateabout $47.7 million in goodwill and intangible assets and boost the company'stangible book value per share by 56 cents.

The company said the sale will allow it to focus onits core community banking business, improve operating leverage and boost itscapital position; the capital redeployment will support organic loan growth andpotential future "strategic opportunities," according to an SECfiling.

Old National Insurance had about $42.7 million intotal revenue and direct expenses of approximately $36.3 million in 2015. Thefirm had 279 employees at March 31.

Sandler O'Neill & Partners LP acted as financialadviser to Old National in the transaction.