Direct Line shares tumble as Belgian insurer Ageas drops its takeover attempt

SHARES in Direct Line plummeted on Monday as markets opened for the first time after potential suitor Ageas said it would not bid to buy the company.

The insurance company was trading down as much as 15.8 per cent during the morning as investors reacted to the news, which was released on Friday evening.

On Friday, Ageas, a Belgian insurer which is headquartered in Brussels, said that after being unable to “engage with” Direct Line’s board despite two attempts, it “will not make an offer” to buy the firm.

Shares in Direct Line soared last month as it revealed it had rejected a takeover approach from its Belgian rival.

Ageas said it had sent an initial proposal to Direct Line on January 19, then improved its bid on March 13.

“Throughout the entire process, Ageas has always sought engagement with Direct Line’s board,” the would-be bidder said on Friday.

“Ageas regrets that it has not been able to work collaboratively together with the board of directors of Direct Line towards a recommended firm offer.

“Ageas was not able to identify additional elements based on publicly-available information that would justify significant adjustments to the terms of its possible offer.

“Therefore, consistent with its financial discipline, Ageas has decided not to make a firm offer.”

Direct Line responded in a statement which was issued on Friday evening: “The board is confident in

Direct Line group’s standalone prospects.

"As communicated at Direct Line group’s 2023 preliminary results on 21 Marc 2024, the board believes under Adam Winslow’s leadership the company is well-positioned to drive material improvement in performance that is expected to unlock significant value for Direct Line Group shareholders.”