Aviva Share Discussion Threads

[whatsup32] 04/12/2024 09:24

Bid for Av may be a little wishful thinking .
I've been wishful for a long time.

While our Dame has not put a foot wrong and move on DLG may be right . It is depressing to not see a decent rise in share price

[1robbob] 03/12/2024 12:55

I think that AV will prevail in the DLG bid, with a slightly sweeter Offer to gain the recommendation of the DLG BOD

Although the initial share price reaction may well be positive. Personally I am not enamoured by the prospect. 20% of the UK Motor insurance market an exceedingly 'fine margin' bisininess, it is very high profile politicaly which will generate mega noise in the media. The rational relies on AV being able to upsell other products to the DLG customer base.

Also the cost to us, could well be a reduction in dividend growth in 2025 from 7% to 5%, as I suspect there may well not be a Share Buyback in 2025 to fund the deal.

Personally I would have rather seen AV flog off their Motor business and buy M&G with the proceeds

I have to wonder if the attraction of DLG to AV is as a defence against a takeover of itself. With 20% of the market, any bid from a company with ANY Motor Insurance exposure would almost certainly be bounced by HMG

If there is a bidder for AV out there, they need to act now

[whatsup32] 03/12/2024 09:52

If Av share price rises from here they will not need to increase bid offer to DLG by much if at all.
Could be win win for both parties

[masurenguy] 03/12/2024 06:45

"Insurers have seen a surge of inquiries from people buying life insurance to provide a lump sum that will cover the cost of an inheritance tax bill. If you get the right amount of cover it could mean that your beneficiaries will not have to sell any assets, such as the family home, to settle the bill when you die. Life cover could also solve the cashflow problems that many families face following a death, especially given delays in the probate system." Times Money

[huckers] 01/12/2024 12:11

From the article…

“Deutsche Bank analysts reckoned Aviva could raise its offer to 270p. “Our sense from talking to a wide range of investors is that shareholders of both Aviva and Direct Line are receptive to this deal,” they said.”

“ We’re making excellent progress in the early stages of a significant turnaround…221;. Marking his own homework.

I’m hopeful we’ll see a higher, supported offer.

cyberian. Agree with all your comments.

[cyberian] 01/12/2024 12:11

From the Sunday Times article I think that the Direct Line CEO has put his foot in it with respect to the comment over his £6 Million bonus after 3 years. Why would the common shareholders who have over 55% in Aviva and DLG want to indulge him and his new team over at least 3/4 years. They will reap a more certain return accepting Aviva's offer in my opinion. Personally think a slight increase to 270p would be more than acceptable and see no point in overpaying.Again Ageas and others entering the bid for DLG would not gain any rationalization over cost savings.

[skinny] 01/12/2024 11:56

The article :-

[whatsup32] 01/12/2024 09:45

Sunday Times "Direct line boss hits out at Aviva bid"
Echo's previous view of opportunistic.
Sir Peter Wood said raising offer 10% would be "fair result"
Pandora "raising offer to 270p would be acceptable to both Aviva and DLG holders.

My view is market is receptive to this takeover even at c270p and we may see Av share price climbing after deal there by benefiting current DLG and Av holders.

[sajad37] 30/11/2024 22:37

Direct Line founder Sir Peter Wood says Aviva must raise its offer


Updated 21:50, 30 Nov 2024
By ALEX BRUMMER CITY EDITOR
Amanda Blanc needs to raise her bid for insurer Direct Line by 'several hundred million pounds' if the Aviva boss is to secure control of its rival, founder Sir Peter Wood says.

Speaking to The Mail on Sunday from his Palm Beach mansion in Florida, near to Donald Trump's Mar-a-Lago, he also expressed frustration at Direct Line losing its way.

'I made it the world's most efficient insurance company', he said, describing how he eliminated the middleman in the form of the insurance broker.

'It's sad it's been run so badly. After I left, the HR department multiplied ten times. It didn't develop a female brand, multi-car or multi-family policies, and just seemed to go backwards.' Wood says staying off comparison websites was a mistake, adding: 'They should have made Direct Line a premier product, where people answer the phone immediately and you got an individual giving you personal attention.'

He expressed sympathy for chief executive Adam Winslow's effort to turn it around, saying: 'He is trying to do a good job, but it's a three or four year job.'

On Thursday, Direct Line rejected Aviva's £3.3 billion bid, whereby shareholders would receive £1.12p a share in cash and 0.28 of a new Aviva share for every Direct Line share held.

[spud] 30/11/2024 20:15

Me neither Pander. I'm paranoid that AV will be sucked into a bidding war & caution against DLG overpricing itself. It's only worth the sum of its parts (synergies aside). spud

[pander45] 30/11/2024 19:48

Not sure about this one. Getting sucked in is a tangible threat. Direct line is a "has been" 80s business model that has not moved well with the times.

[cyberian] 30/11/2024 16:31

The Belgium company Ageas would not have the same synergy that Aviva has to provide adequate cost savings and investment benefit and as stated by others their share price would fall accordingly. Again Ageas paper would also not be as attractive compared to Aviva.

[careful] 30/11/2024 13:41

Another 10% on the bid is worth about £350m.
Not a large amount spread over the years after synergies.
AV may be prepared to go a little higher.

Odd position for DLG holders.
Because some of the bid is in Aviva shares, accepting a lower bid would give AV. shares a boost.

Much to ponder for both parties.

[pete160] 30/11/2024 12:43

The Belgians share price has improved because they dropped their bid for dlg.
If they re-engage, their price will drop again, and possibly by more if they get into a bidding war with Av.

[whatsup32] 30/11/2024 11:13

Failed Belgian offer must have hissed of many DLG holders. Seeing share price drop from 230p ish to near 150p must have hurt.
I suspect they won't want to miss this opportunity and will back Av t/o.
If I was CEO of DLG I would encourage Belgians to comeback and show interest.
Belgian offer is currently better for DLG as their share price has gone up.
Pleased that our share price hasn't moved , can only presume market thinks there is value here even with t/o

[spud] 30/11/2024 10:13

Agreed! Far too easy to be lured into a bidding war. I'd also say 300p is more than borderline and would largely defeat the object of buying the Company in the first place.spud

[dr biotech] 30/11/2024 10:10

One major shareholder talking up his own book. I think AV should just offer a take it or leave it deal at the current bid or just above - then DLG shareholders can watch their share price collapse back down if they reject it.

[cfro] 30/11/2024 09:14

What next in Aviva's bid for Direct Line?



Some snippets from the article:

A source close to Direct Line said "the ball is in Aviva's court".
One major shareholder in Direct line thinks 300p will be enought to get the deal over the line.
Other major shareholders still to make a decision.
KBW reckons the deal would become "borderline" for Aviva at around 300p per share and that a counter-bid should not be ruled out.
Jefferies would not be surprised to see Aviva make an additional bid and thinks 270p might be acceptable.
CMA only likely to block the deal if more than 25% of the motor insurance market. The combined group should see Aviva claiming just over 20%.

[lord gnome] 30/11/2024 08:59

Or how about just keeping it simple and avoid the complex conspiracy theories? Perhaps AV has just spotted a major competitor with a decent market share having short term problems and sees an opportunity to buy them on the cheap.

[pete160] 30/11/2024 08:54

Thanks CJAC, your insights are always welcome.
Could it be that, if Av have c. 10 share of uk car insurance market and DLG have similar share, someone at Av. has said they either need to get bigger or get out ?
By getting bigger, perhaps they are hoping to improve pricing power by removing a key competitor?
or more simply, perhaps the AV BOD are doing it to spite their ex colleagues who jumped ship to DLG, and all Av. are doing is trying to entice another buyer to step forward ? :-)

[cjac39] 30/11/2024 07:32

the thing that i dont understand is the lack of ambition. having trimmed down av its now surely time to get book value growth going. why not dispose of the heritage biz given its low roe. what are they doing about anaemic results at agi? why not spin off a bpo biz into a jv? what are they doing in private assets and why not launch a jv here. what about ceding a reins biz to capture some of the excessive premiums they spend here. no lets buy a boring motor insurer and target one of the most competitive low roe mkts that by the way will be targeted by the fca - figure me how if i buy insurance today its 1000 but if i forward start by 20 days its 800. not good business. i get synergies but the cma wont like it anyway. yawnsville.

[yump] 29/11/2024 18:42

How do you post that Italian mafia hand across the throat symbol?