Zurich Insurance Bids A$741 Million for Australia's Cover-More

   By Robb M. Stewart 
 

MELBOURNE, Australia--Australian travel insurer Cover-More Group Ltd. (CVO.AU) has agreed to a 741 million Australian dollar (US$552 million) takeover offer from Zurich Insurance Group Ltd. (ZURN.EB).

In a statement Monday, Cover-More said it had entered an agreement under which Zurich Insurance would offer A$1.95 a share in cash, representing a 48% premium to the closing price for the shares last Friday.

Cover-More's board said it unanimously recommended shareholders vote in favor of the agreement, in the absence of a higher bid and subject to an independent expert concluding the scheme was in the best interests of investors.

"The sale of the company at a significant premium to market is an attractive outcome for shareholders," Cover-More Chairman Louis Carroll said.

Under the terms of the deal, Cover-More is permitted to pay an interim and a special dividend, which would reduce the cash amount of the offer.

Cover-More said it expected earnings before interest tax, depreciation and amortization of between A$54 million and A$57 million for the 2017 financial year.

Write to Robb M. Stewart at [e-mail]

(END) Dow Jones Newswires

December 11, 2016 17:16 ET (22:16 GMT)

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