I think the last few posts (pOpper,Glavey and fenner66) are a little off beam
The 2024 dividend is uneffected and obviously not available to DLG shareholders
They have said that the 2025 dividend per share will be mid single digit % higher than the 2024 dividend per share.
....The 2025 total cost of dividend is then the rebased level
Thus the 2026 dividend will be + mid single digit % higher in the total dividend cost |
p0pper - since there are going to be 12.5% more shares in issue a 5% or so rise in "cash cost " is effectively a dividend cut.
If that is correct - I think it is - then its all about how they spin the words to give an impression to the masses that is factually accurate but the opposite of what is interpreted.
Posts above "think" dividends are going to rise , whilst it looks like initially they will fall post acquisition , mission accomplished with the wording? |
Indeed, I believe you do read it sadly. |
"From this rebased level". Does that mean they will only spend the same amount as they are now even though there will be far more shares in circulation? and then still increase it by mid single digits, if so it means a divi cut?
Sadly that's how I read it. |
I am trying to decode the AV statement re their dividends and Share Buybacks going forward
They are saying today in the DLG document
...'Enhancing shareholder distributions: as part of its commitment to shareholder returns, Aviva currently intends to de: clare a mid-single digit percentage uplift in the dividend per share following Completion. Aviva further intends to maintain the current guidance of mid-single digit growth in the cash cost of the dividend from this rebased level.'
I take this to read
2024 Dividend: +7% ie mid single digit increase in the DIVIDEND CASH COST so 5% + benefit of Share Buybacks reducing number of shares in issue
2025 Dividend: +5% ie mid single digit increase in the DIVIDEND PER SHARE
2026 Dividend: +7% ie reverting to mid single digit increase in the DIVIDEND CASH COST so 5% + benefit of Share Buybacks reducing number of shares in issue
I think this part of the DLG Announcement clearly indicates NO Share Buy-back in 2025 |
It's going to take around 6 mths to complete, by then it will be good value! |
They overpaid. Short term pain, but eventual gain. |
I was bargaining on holding AV. in the end when I bought my DLG shares, AV. offering a far more stable business and a significantly higher dividend. |
275p looks a very fair price and i think this is excellent news for both sets of shareholders..
No reason why this shouldn't be earning enhancing to AV and will really strenghten-up AV's position in the motor insurance market. |
 As a DLG holder happy to see the bid is in but it's going to take a while!
The boards of Aviva and Direct Line are pleased to announce they have reached agreement on the terms of a recommended cash and share offer for Direct Line (the "Acquisition").
· The Acquisition builds on Aviva's strong performance over the last four years, with Aviva having been transformed into a high-performing business with a clear strategy. The Acquisition will accelerate Aviva's momentum and will offer customers and shareholders a number of benefits as set out below.
· Under the terms of the Acquisition, each Direct Line Shareholder will be entitled to receive:
For each Direct Line Share held:
0.2867 New Aviva Shares;
129.7 pence in cash; and
up to 5 pence (in aggregate) in the form of dividend payments to be paid (subject to the approval of the Direct Line Board) prior to Completion
(together, the "Offer Consideration")
· Based on the Closing Price of Aviva Shares of 489.3 pence on 27 November 2024 (being the last closing share price before the commencement of the Offer Period), this values each Direct Line Share at 275 pence and values the entire diluted share capital of Direct Line at approximately £3.7 billion.
· This represents a premium of approximately:
° 73.3 per cent. to the Closing Price of 158.7 pence per Direct Line Share on 27 November 2024; and
° 49.7 per cent. to the six month volume weighted average price of 183.7 pence per Direct Line Share to 27 November 2024.
· Upon Completion, it is expected that Aviva Shareholders will own approximately 87.5 per cent. and Direct Line Shareholders will own approximately 12.5 per cent. of the issued and to be issued share capital of Aviva. |
Well there it is..a lot of stuff to read through and pleased that we don't go into the xmas week with prolonged uncertainty.
This line item in particular caught my eye.
"Aviva further intends to maintain the current guidance of mid-single digit growth in the cash cost of the dividend from this rebased level". |
(Alliance News) - Direct Line Insurance Group PLC has announced the launch of three new motor insurance products on a comparison website.
The products are being made available on Compare the Market and Direct Line Group plans to expand their availability across other price comparison websites in 2025.
The group announced in July that it planned to launch on price comparison websites, for the first time in the insurance brand's history, after years of telling consumers it was not on such websites.
It had said that price comparison websites were visited by 90% of consumers when deciding on insurance.
Direct Line said on Friday that the new products allowed customers to manage their policy digitally, but a telephone service remained for claims.
It would continue to sell products directly to consumers.
Adam Winslow, chief executive officer at Direct Line Group, described the move as "exciting", adding: "We are delivering a key pillar of our corporate strategy, demonstrating how we can move at pace to meet the changing needs of our customers."
Mark Bailie, chief executive at Compare the Market, said: "This launch marks an exciting moment for Compare the Market, we are thrilled to be entering into this exclusive partnership." |
Unless my calculations are incorrect the value to Direct Line shareholders based on Aviva's closing share price on Friday is 252p, plus their 5% dividend. The latter I think equates to 2p. All back of the envelope so stand to be corrected. Obviously if the deal is executed as it appears it will from the Sunday Times article then Aviva's share price may well jump as they suggest that the deal would be positive for Aviva. |
Markets closed at 12.30 on Xmas eve if I'm not mistaken |
The deadline is 5PM Xmas day isn't it so you would expect in reality it will be Xmas eve. |
I think I'm right in thinking Av have until end next week to make formal offer to DL .
Options
1. Offer will be as outlined previously @275p ,
2. slightly higher due to Av share price going down
or slightly lower due to diligence.
Not knowing how it will playout will have hit Av SP
I'm hoping for gradual increase in share price after formal decision.
Also small risk of Amanda losing interest in DL
I'm of to not so sunny Vegas for Christmas.
Wishing all a great year
Thank you spud for keeping this thread tidy . |
WBA/Huncher
Was the L&E scheme subject to a buy in bulk annuity contract? Aviva has done several with its schemes.
The dismissal of discretionary increases is one of the downsides of the bulk annuity world - when the trustees insure the pensions they tend to only buy the minimum contractual terms. Complain to the Pension Regulator about such practices so schemes have to procure the minimum increases in later pensions regulations. If the scheme has not done a full buy out (you would be policyholders of an insurer), then the trustees are still on the hook for how they treat you. |
In the same boat, with no discretionary increase for years at a time of very high inflation, increase this year £80 PY about the same as last 3 and this is my main pension. I concur with your thoughts but they will just turn round and say it is within the terms. Oh for the L&E days. |
WBA1
Just seen your post on the thread monitored by AW which due to circumstances beyond my control I am unable to reply to.
It is something I was unaware off and if correct is very underhanded but I will have to take it up with Aviva now so thanks for the heads up.
I have noticed that whereas in the past when sent notifications by Aviva it was customary to be sent a business reply envelop so you could respond if necessary but that is no longer the case.
Seems a bit mean spirited but every penny counts I suppose.
Will be watching 444 as is my next target but has to go some to match the dividends on offer elsewhere
Lots of nerves apparent today and think will have more of the same over next few days.
Is very easy to be caught out in such a thin market
I still think there is further downside risk to come so be careful.
I have to all intents and purposes finished for the year but have left a few offers as is my wont.
Have a good xmas all |
I have not posted on here for a long time due to past political content but feel I have no choice now, on a topic unrelated to the takeover.
I am an Aviva pensioner from my L&E days. Fortunately I have multiple company pensions and no reliance on my Aviva pension. However today I received the notice of annual increases. Pensions accrued after April 1997 have increases specified in the pension terms but those accrued before that date only receive discretionary increases. This year Aviva have awarded 0% increase on pre-April 1997 pension. This will disproportionately affect the oldest and most vulnerable of Aviva's pensioners and is a quite disgusting act by a company which claims to value its staff. I am putting this information out there to both shame the company and to ensure that it is not kept quiet because others do not want to put their heads above the parapet. |
My guess/hope is that AV will not change the proposed Terms. If the DLG Directors fail to recommend the deal, AV will proceed without their recommendation.
It would then be up to the DLG Board to elicit a better Offer from a 'White Knight'
Personally, I hate the idea of this deal and would be delighted if it disappeared |
I think so, therefore I would guess that if they remain serious buyers of Direct (DLG) then they will just leave the potential offer as before. Shares do go down as well as up and sure that is accepted in good faith by both parties, but I am no expert on tactics etc. Unless anything untoward has been revealed I would guess that Aviva will just stay with the earlier offer. I wish Eurofox was still posting and hope he is well. |
Was it not the value of the shares on that particular day the the terms were agreed? |
It is already lower as any bid involving a level of shares as part of potential offer is exposed to the share price in this case Aviva's. Maybe Aviva will just leave the terms as last indicated so take it or leave it. I just cannot see Aviva increasing the number of shares being offered. |
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