UK insurer Direct Line Group has rejected Ageas’ recently announced offer for the company, labelling it “unattractive” and “highly opportunistic”.
The firm’s Board has now confirmed that on 19 January 2024, it received a highly conditional, non-binding indicative proposal from Ageas to acquire the entire issued and to be issued share capital of Direct Line Group.
As previously covered, the terms of the offer comprised 100 pence in cash and one new Ageas share for every 25.24047 Direct Line Group shares. As at closing on 27 February 2024, the Proposal implies a value of 233 pence per Direct Line Group share.
Commenting on the offer, Direct Line said, “The Board considered the Proposal with its advisers and considered it to be uncertain, unattractive, and that it significantly undervalued Direct Line Group and its future prospects while also being highly opportunistic in nature. Accordingly, the Board unanimously rejected the Proposal on 29 January 2024.”
The firm added, “Direct Line Group shareholders are advised to take no action in relation to the possible offer. A further announcement will be made as and when appropriate. There can be no certainty that any firm offer will be made.”
Direct Line’s Board also reiterated its confidence in the Group’s standalone prospects, given its “strong strategic position, powerful brands, and robust capital position”.
Adam Winslow is set to take up the role as CEO on 1 March and is tasked with “refreshing” the strategy and operational focus of the Group with the clear objective of returning to a sustainable level of operating profit over time.
