Zurich drops takeover of RSA Insurance

Zurich has dropped takeover talks with RSA Insurance, it revealed this morning.

Related topics:  Finance News
Amy Loddington
22nd September 2015
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RSA Insurance revealed in August that it had accepted a provisional £5.6bn takeover proposal from Zurich, with Zurich having revealed its intentions to make a bid a month earlier.

However, in Zurich's preliminary update on Q3 released yesterday, it noted that it expects significant losses related to the series of explosions at a container storage station in the Port of Tianjin in China in mid-August 2015 and that there remains some uncertainty as to the final costs. In addition to claims relating to the Tianjin port explosions, Zurich now expects that weaker than expected profitability in the General Insurance business in the first half of 2015 will continue in the third quarter.

The statement continued:

"In light of the above recent deterioration in the trading performance in the Group's General Insurance business, Zurich announced this morning that it has terminated its discussions in connection with a possible offer for RSA. The Group's focus instead will be on taking the necessary actions to deliver on the required performance of the General Insurance business."

RSA said in a statement:

"The Board of RSA notes the trading update and the Rule 2.8 announcement published by Zurich Insurance Group. As a result of recent deterioration in the trading performance of Zurich’s General Insurance business, Zurich has terminated discussions with RSA regarding a possible offer."

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