lambrini girl
03 Aug 2015
Re: Zurich won't need 28 days to make a ... my machine is indicating a £6 offer..naturally the price showing some caution..
give the dog a bone
03 Aug 2015
Re: Zurich won't need 28 days to make a bid surely the slow rise to the 550 to 600 range indicates that the market is not believing this bid will succeed. if I was a fund manager holding RSA , then I'm hardly likely to sell at 525 ( current price). Maybe once they get to look at the books, Zurich will walk away - after all insurers have much the same products and the staff just waft in and out of each others departments with the minimum of training - all paid much the same and the new boss is the same as the old boss, trotting out the same old tosh.
wind machine
02 Aug 2015
Zurich won't need 28 days to make a bid If my reading of the tea leaves is correct then a bid will be forthcoming and it's just a question of what is the lowest price that Zurich can get away with paying in order to secure the RSA Board's recommendation to RSA shareholders that they accept the offer.In an ideal world Zurich would like to secure the RSA Board's acceptance of the inevitable by the time RSA announces its interim results on Thursday 6 August. I'd expect plenty of midnight oil to be burned over the next few days.
idontwanttolose
02 Aug 2015
Stephen Hester prepares to strengthen hand as Zurich circles RSA Stephen Hester is preparing to persuade investors in RSA that his efforts to transform the FTSE 100 insurer are bearing fruit as he responds publicly for the first time to takeover interest from larger rival Zurich Insurance.As he tries to maximise the value of a bid from the Swiss insurer, which is preparing to make an all-cash offer, RSA’s chief executive is expected to present this week a sharp improvement in first-half profits.Yet the results are also expected to highlight some of the pressures RSA has been under that have hampered Mr Hester’s turnround attempts and made the insurer vulnerable to a bid.The income RSA generates from its £14bn investment portfolio — traditionally a main source of profits — is forecast by Numis to have fallen another 15 per cent to about £190m, after a 13 per cent decline a year ago.Zurich acknowledged last week it was considering making an offer for RSA, which has a market cap of £5.3bn.People close to Mr Hester say he is willing to reach an agreement to sell RSA, which provides car and home cover as More Than in the UK. The results are a chance for him to strengthen his hand before takeover talks.Despite the strains on investment income, an improved performance at RSA’s operations in Latin America, Ireland and the UK boosted RSA’s interim operating profits 70 per cent from a year ago to £240m, forecasts Panmure Gordon.The broker estimates pre-tax profits more than trebled to £232m from a year ago, when the insurer’s earnings were hit by a £57m writedown at its Ireland arm.The Ireland business was at the centre of an accounting scandal shortly before Mr Hester was hired to lead a recovery about 18 months ago.The results will allow Zurich, due to publish its half-year results on the same day as RSA, to gauge the financial condition of its prospective acquisition.An unexpectedly strong or weak disclosure from RSA would be likely to influence the price Zurich, which has been considering a possible bid at about 550p a share, is prepared to pay. Shares in RSA closed at 514p on Friday giving the company a market capitalisation of about £5.2bn.The bid interest has caused fresh uncertainty among RSA’s 19,000-strong global workforce. More than 1,300 positions have already gone under the insurer’s own plans to cut costs by at least £250m a year by 2017.To justify the acquisition Zurich would need to find an additional $350m worth of savings, Berenberg estimated. That would involve further job losses at RSA, which employs about 7,000 people in the UK.Yet in a tentative sign Mr Hester is making progress in his overhaul, RSA is this week expected to reinstate its interim dividend, worth about 3p a share. The payout was scrapped last year.The insurer is also forecast to book gains worth about £130m after it sold businesses in Hong Kong, Singapore and China in the period as part of Mr Hester’s streamlining.
idontwanttolose
02 Aug 2015
Insurer RSA ready to hold out for 600p-a-share bid from Zurich From the Daily Telegraph[link] board of the FTSE 100 insurance giant RSA are understood to be pushing for a take-out price of at least 600p a share from potential bidders Zurich, The Sunday Telegraph has learnt.Advisers to RSA were this weekend turning their attention to the potential value of the company after last week’s confirmation from the Swiss insurance giant that it is considering making a takeover offer.At last week’s reported price of 550p a share, investors would get a premium of more than 20pc to the so-called undisturbed price before takeover rumours began to swirl.However typical take-out premiums for FTSE companies have started at 30pc or higher of late.Recent deals for other property and casualty insurers, such as Meiji Yasuda’s $5bn (£3.2bn) bid for US firm StanCorp last week, have commanded premiums north of 40pc.It is for that reason that the Swiss insurer is thought likely to have to raise its mooted bid if it is to receive the backing of the eight-man board.RSA’s board met last week as scheduled to discuss the results, although the takeover interest from Zurich meant the agenda was more crowded than expected.The firm, once known as Royal & Sun Alliance, has spent the few days since Zurich declared its intentions last Tuesday assembling a large and growing team of advisers.Goldman Sachs, the investment bank already working on the sale of RSA's Latin American operations, is helping to draft the group’s next moves with Zurich. Paul Miller, head of insurance for Europe, the Middle East and Africa at Goldman, is leading the team.Robey Warshaw, whose founders worked with RSA chief executive Stephen Hester on deals during his time in charge of Abbey National and later RBS, is also advising.Brokers Bank of America Merrill Lynch and JP Morgan are also understood to be playing a role. Morgan Stanley is working with Zurich.RSA’s pension liabilities of £7.6bn have discouraged other bidders in the past. Although insurer-sponsored pension funds are viewed more generously than annuity books by regulators assessing capital levels, the RSA pension fund is larger than its entire market value, and comes with three sets of trustees from acquisitions
II Editor
31 Jul 2015
NEW ARTICLE: Share of the week: Hikma buys big in US "There were several double-digit percentage gainers among London's first and second-tier stocks this week. The big winners were takeover targets, but one drugs player did pretty well without a buyer. Instead, it was the aggressor and a $1 billion ..."[link]
jarfurrank
30 Jul 2015
Re: RNS Activity OmallyThanks for the info.Jarfur
JohnOmally
29 Jul 2015
Re: RNS Activity The code on takeovers requires holders (with more than 1%), financial intermediaries to make declaration on how many shares they hold, control, short positions and trades on a daily basis. The news section will fill up with these notification from now until a deal is done or is called off. The notifications will be rule either 8.3 and 8.5 depending on the status of the notifier. From previous experience it can be quite frustrating finding out whether any announcements of substance have been madeOmally
jarfurrank
29 Jul 2015
RNS Activity There seems to be an explosion of RNS notifications today. I have looked at a few and can make no sense of them - can anybody help?
oggs
29 Jul 2015
Re: any offer, if made, will be solely i... i think the regulators would positively welcome it. There is noyt much dobt tht ZUrich is a stronger firm that RSA
weblogic
29 Jul 2015
Re: any offer, if made, will be solely in ca... Questions..Will the offer be forthcoming, and can an agreed price be struck..Will it get past the regulators, if so..How do you really value this business...competition is very sharp in this market, hence RSA depressed price of late...What will Zurich make of the books.....How much will restructuring costs stack up on a merged entity..What about job costs, etc....Timescales...I guess you`re looking at a potential offer circa £5 - £5.50p ish..Forward prospects.. I am fairly neutral about outlook in the Insurance sector..Competition and economic factors probably suggest that the outlook currently is fairly stable... . Eurozone issues are but one concern for the coming period...and Greece looks a festering problem which I don't see getting fixed unless there is some radical Euroland changes and restructures. Two speed EU etc...
idontwanttolose
29 Jul 2015
any offer, if made, will be solely in cash. Statement Regarding RSA Insurance Group plc Further to the announcement issued on 28 July 2015 in relation to RSA Insurance Group plc, Zurich Insurance Group Ltd. ("Zurich"
confirms that it is likely that any offer, if made, will be solely in cash. No disclosure under Rule 2.10 of the City Code on Takeovers and Mergers will therefore be made in relation to securities in Zurich.
idontwanttolose
28 Jul 2015
The Financial Times said Zurich was considering a bid valuing RSA at 5.5 billion pounds Cash-rich Zurich Insurance (ZURN.VX) is weighing a bid for British rival RSA (RSA.L) which could top $8 billion, as insurers look to diversify amid tighter regulations and toughening market conditions.Zurich's statement on Tuesday that it was considering a bid drove the largest one-day gain for 23 years in the British insurer's shares, which closed up 18 percent at 490 pence.European Union rules due in January governing how much money insurers must set aside to protect against market shocks have already prompted some tie-ups.The rules reward insurers with a breadth of geographical or sector coverage, as this cuts their capital costs. With low investment returns and soft insurance prices in many markets, analysts also expect more industry consolidation.Zurich, a 45 billion Swiss franc (£30 billion) group offering a range of life and general insurance products, said it was looking at a bid."Zurich notes the recent market speculation in relation to RSA Insurance Group Plc and confirms that the company is evaluating a potential offer," it said, adding there was no assurance any offer will be made.RSA, best known for its More Than home and motor insurance brand, said it had held no talks with Zurich and received no proposal.The Financial Times said Zurich was considering a bid valuing RSA at 5.5 billion pounds, or 550p a share. Barclays analysts said Zurich had around $3 billion in surplus cash and could take on debt of up to $5 billion."RSA has many strengths that would complement our business," a Zurich spokesman said. "RSA is very clearly strong in Britain but also in Scandinavia and Canada. And they have business in Latin America, a market which we want to expand."RSA shares stuck well below the reported 550p offer price, with analysts saying this reflected uncertainty a deal would take place. Zurich shares fell 1.8 percent on concern that a deal would cut chances of cash being returned to shareholders.Zurich had said in May it had $3 billion (£1.9 billion) in extra capital it would either hand back to its owners or spend on acquisitions by the end of next year.After multiple profit warnings, triggered in part by an accounting scandal in Ireland, RSA hired former RBS boss Stephen Hester last year to lead its recovery. The company swung to a profit in 2014.DEAL VALUEA tie-up between Zurich and RSA would follow several big insurance deals. Swiss group ACE (ACE.N) bought upmarket property insurer Chubb Corp (CB.N) this month in a $28 billion deal to get access to wealthy clients.Analysts said Zurich and RSA would be a good fit but there could be counter-offers. "AXA or a number of other U.S. and European insurers could be interested," said Barrie Cornes at Panmure Gordon. "RSA is now effectively in play."French insurer AXA (AXAF.PA) said it did not comment on market rumours.In its most recent results, RSA posted a 1 percent rise in net written premiums and said profits were ahead of plan, boosted by disposals. It was also weighing a possible sale of its Latin American business, a source told Reuters earlier this year.However, RSA is battling a competitive UK insurance market and has struggled to boost investment income in the current low-interest rate environment. Its largest shareholder is activist investor Cevian Capital, with 13 percent.Canaccord Genuity analysts said 550p a share would be a "fair offer" and noted the purchase would give Zurich a leading position in Britain. RBC analysts said RSA's Scandinavian presence was particularly attractive.Shore Capital analyst Eamonn Flanagan said an outright sale of RSA was preferable to a possible breakup, given concern any partial sale could see money diverted to plug a pension deficit.Barclays analysts said RSA had a pension deficit of around 500 million pounds, while Zurich itself has a UK scheme deficit of around $2 billion, "so Zurich has significant experience of managing UK pension issues."
Ripley94
28 Jul 2015
Re: RSA RNS PANMURE advised sell yesterday , ( up 19% )Brokers !
idontwanttolose
28 Jul 2015
We think 550p would be a fair offer for RSA Following an announcement earlier on Tuesday from Zurich Insurance that it was evaluating a potential offer for RSA Insurance, the London-listed company said it has not held talks with or received a proposal from Zurich. Earlier, Zurich said the announcement does not amount to a firm intention to make an offer and there can be no assurance any offer will be made.But in an afternoon statement, the FTSE 100 company said: "RSA has not held talks with or received a proposal from Zurich and shareholders are advised to take no action."Zurich bid or not, RBC Capital Markets said RSA is an attractive bid target. Although RSA has encountered a number of problems in its business in the last two years, it continues to have an attractive geographic split of business, said the Canadian bank.“RSA has strong market positions in Scandinavia, in Canada, a large UK commercial franchise and operations in Latin America. Of particular interest to bidders would be the Scandinavian business in our view. Scandinavian insurance markets have oligopolistic characteristics, with few market players and strong profitability with low levels of competitions,” the bank added.As far as premiums are concerned, RBC said the management team at RSA are likely to be more willing to accept a lower bid premium than the recent ACE-Chubb deal that yielded a 30% premium for the company.“We also believe that investors in RSA will be more willing to accept a lower bid premium to the current share price due to a more protracted turnaround at RSA than the market expected in our view.”RBC anticipates that a 10-20% premium would be sufficient to secure RSA. This implies a 480-525p offer range.Meanwhile, Olivetree Securities said the general attraction of RSA is the stable and cheap valuation of the assets.It noted that RSA currently has assets of £14.5bn supported by a market capitalisationof £4.4bn, “markedly cheap thanks to the performance issues which have dogged the company over the last few years”.“The general thinking around a takeout story is usually to acquire RSA and take the assets (i.e pay a low price for them) and reinvest them in a much better way than RSA has done itself. This leaves it potentially attractive to a financial buyer such as Berkshire Hathaway (with which it has a lot of commonality in business agreements and even personnel) but also to large cap peers just looking to bolt on cheap assets,” said Olivetree.It noted that at last set of numbers, management dampened speculation of a full break-up of the company by highlighting the size of the pension liabilities, culminating in a £3.1bn buyout cost. “This leaves a sale to a larger peer, such as Zurich, as the only reasonable path for RSA to crystallize value through M&A.”With a potential bid now on the cards, Canaccord Genuity raised its rating on RSA to ‘buy’ from ‘sell’ and lifted the target price to 500p from 385p, which is a 10% discount to the offer price that’s been talked about.“We think 550p would be a fair offer for RSA, but think there must still be a material risk that no offer is forthcoming, or that part of the offer is in Zurich shares, which come under some pressure,” it said.Canaccord said that with RSA progressing slowly through its recovery, and weighed by a large pension liability, its shareholders are likely to want an offer at a material premium, given the value on a sum of the parts basis.“While we expect Zurich shareholders to be cautious in their response, reflecting management’s lack of track record in a deal of this scale, and the material long tail and pension liabilities that would be brought onto Zurich's balance sheet, there would likely be material synergies, and a purchase would give Zurich a leading position in the UK, add materially to Latin American scale, and give entry to two attractive markets, Canada and the UK.”Shares in RSA pared gains immediately after the announcement from the company, but by 13
9, they were sharply higher aga
