Britain’s oldest insurer, RSA, has recommended this morning that shareholders accept a £7.2 billion bid from Toronto based insurer Intact Financial Corporation and the Danish group Tryg.
The deal will result in a break-up of RSA’s extensive overseas businesses, with Intact taking control of RSA’s operations in the UK and Canada. Tryg will take control of RSA’s Sweden and Norway businesses.
Cevian Capital, RSA’s largest shareholder with a 14 per cent stake has given an “irrevocable undertaking” to vote in favour of the bid. The bidders also revealed this morning that they had secured agreement with the pension trustees, which was seen as key to a deal.
Shares in RSA surged by almost 46 per cent earlier this month after the company confirmed reports of the takeover bid. The FTSE 100 company has long been considered by investment bankers to be an ideal candidate for a break-up.