Ageas is willing to pay more for a takeover of Direct Line.
The British insurer announced this on Wednesday, after which Ageas also provided confirmation
Ageas wants to pay £1.20 per Direct Line share, plus 1 Ageas share for every 28.41 Direct Line shares. Based on the closing price on March 8, the day after Ageas announced its intention to Direct Line, this amounts to £2.37 per Direct Line share, 3 percent more than the £2.31 it previously said it would want to pay.
As of March 12, the increase would amount to an offer of 2.39 pounds per share and that is 46 percent more than Direct Line's share price just before Ageas' plans were announced. “A substantial premium”, Ageas CEO Hans De Cuyper said in an explanation on Wednesday.
However, Ageas could not convince Direct Line with this increase. The British insurer called Ageas's plans "uncertain, unattractive and a significant undervaluation." Direct Line also called the approach by Ageas "highly opportunistic."
The Direct Line board therefore unanimously decided to reject Ageas's proposal.
Ageas remains convinced that a combination of the two companies will be beneficial for the shareholders of both Ageas and Direct Line.
Read also: Ageas on the wish list of Italian Generali
