Off-road

5 Aug 2020 By Christopher Thompson

The Finnish group has made a $2.2 billion offer for the London-listed motor insurer. A 42% premium looks chunky given few cost savings on offer. CEO Torbjorn Magnusson needs to boost revenue in the cut-throat British market and swerve a likely increase in claims to avoid a crash.

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British motor insurer Hastings said on Aug. 5 that it had agreed to a 1.66 billion pound takeover by Finland’s Sampo and South Africa’s Rand Merchant Investment.

The 250 pence per share offer represents a 47.1% premium to Hastings’ closing share price on July 28, the last trading day before Hastings disclosed an approach.

Hastings also reported a 31% jump in first-half adjusted operating profit to 78.3 million pounds, driven by strong growth in policies and a decline in motor insurance claims as Covid-19 restrictions led to less traffic on UK roads.

Hastings shares were up nearly 18% at 253.3 pence by 0827 GMT on Aug. 5.

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