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agreement sealed for the takeover of Direct Line by Aviva

Insurance: agreement sealed for the takeover of Direct Line by Aviva

The agreement for the takeover of the British insurer Direct Line Insurance by its competitor and compatriot Aviva has been sealed, the two groups announced Monday December 23 in a joint press release, an operation worth approximately 3.7 billion pounds (4, 4 billion euros).

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Direct Line rejected a first offer from Aviva at 3.3 billion pounds at the end of November, before announcing an agreement on this new offer on December 6.
Photo : AFP/VNA/CVN

With this buyout, partly in cash and partly in shares, Direct Line shareholders will hold approximately 12.5% ​​of Aviva's capital.

This acquisition should make it possible to create “a leading personal insurance franchise in the UK”it is underlined in the press release.

Direct Line rejected a first offer from Aviva at 3.3 billion pounds at the end of November, before announcing an agreement on this new offer on December 6.

“This agreement strikes a balance that appears to bring value to both parties”estimates Matt Britzman, analyst at Hargreaves Lansdown.

“Direct Line navigates troubled waters” et “could not deny that Aviva's offer is a golden ticket that it would have struggled to replicate on its own”, he notes. “For Aviva, the price is at the limit of what could be considered a bargain, but the strategic potential could prove very attractive.”

Around 08:20 GMT, shortly after the London Stock Exchange opened, Aviva's stock was flat at 0.06%, with the stock having jumped on December 6 when the deal was announced.

AFP/VNA/CVN

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