RSA agrees to $9.55 billion takeover by foreign rivals

LONDON: British insurance group RSA is backing a 7.2 billion pound ($9.55 billion) cash offer from Canada’s Intact Financial and Denmark’s Tryg in one of Europe’s biggest financial takeover bids this year.

Insurers have become an atractive proposition since the coronavirus crisis despite reputational damage from disputes over business interruption claims, industry sources say. Home-working has led to fewer claims on home and motor insurance while commercial insurance rates have risen sharply.

RSA’S directors backed the Intact-tryg bid unanimously and recommended shareholders vote in favour of the consortium’s offer, the company said on Wednesday, having first flagged the approach early this month.

Best known in Britain for its More Than brand, RSA provides home, motor and commercial insurance and also has large operations in Canada, Ireland and Scandinavia.

Rsachiefexecutivestephenhestertoldreporters he planned to step down ater the deal’s completion, adding that he expects a small number of job losses at the group’s UK headquarters and in Canada and Scandinavia as those businesses are integrated.

“RSA has been transformed over the last six years,” Hester said, adding that the deal “represents an excellent outcome for all of our constituencies”.

The former Natwest boss said he expects the deal to complete in the second quarter of 2021 but has no plans for the future as yet.

The proposed takeover would result in the break-up of the British group, with suitors carving it up between them. Intact would gain RSA’S Canada, UK and international operations while Tryg would take the Sweden and Norway businesses.