Direct Line Insurance Share Discussion Threads

[pander45] 28/11/2024 15:52

Market lacks confidence in board as do I hence my decision.

[wba1] 28/11/2024 15:41

Cold winter weather drives up claims is true but pricing includes an element for attritional claims (normal small to medium claims) and an allowance for cat events (big single claims or a big aggregation of normal claims from large events such as storms). Cold winter weather only hurts predicted results when the large events exceed the usual level provided for in the pricing (and even then reinsurance provides some protection).

But as to whether DLG have a strategy I remain on the fence. DLG are overexposed to the UK private car market which is commoditised and where it is difficult to materially outperform the market and has become even harder with the change to rules re dual pricing. This does not matter too much for results this year and 2025 (financial year) as the market will perform ok. From 2026 you can expect a downturn and being too heavily exposed to private car will make it difficult to perform. So they need to reduce the % of business from private car and increase the exposure to other lines, especially commercial. At present I cannot see a meaningful move in that direction and, with the move of the main brand onto comparison sites they even seem to be doubling down on private car just as market pricing seems to be topping out.

The main problem seems to be that the board is dominated by accountants and salesmen and has no senior actuary. I have little confidence in Winslow but that is irrelevant short term. Aviva (or other large trade buyers) can extract serious synergies from a takeover so that is more important to them than the market conditions which should be driving DLG strategy. I will be amazed if a takeover does not succeed, either this time or in 2025.

[jugears] 28/11/2024 15:38

glad I sold at 2.28, this will be back below £2 in a few days.
Facts & figures & severe Floods!

[stevensupertrader] 28/11/2024 15:37

Aviva offer was £1.125 cash and 0.282 Aviva share for every DLG share . Aviva S P is falling as Institutional shareholders are unhappy ,thus making the Aviva offer of £2.50 less and less unattractive as Aviva Share Price falls .

[factsandfigures] 28/11/2024 15:24

That's two potential suitors sent packing now by the DLG Board, it's to be hoped they have a strategy, because cold Winter weather always drives up claims.

[stevensupertrader] 28/11/2024 14:59

FOR THIS REASON - I sold out this morning at £2.282 after 4 years holding on DLG .
I bought in 2021 at £3.24 and averaging down and my last chunk was bought about 2 weeks ago at £1.53 , thus averaging £2.20 .
Good Luck to everyone still hanging on .

[stevensupertrader] 28/11/2024 14:50

One thing for sure DLG Board cannot be trusted . This is the second time that the DLG had an approach of offer but the Board only came out after the news broke and not before . The RNS came out after the Board members bought shares at the cheap . DLG had an offer of takeover on the 19th Nov but only after over a week , it came out only yesterday that the Board rejected the offer . This clearly is dishonest and not truthful to its shareholders and clearly is not on. DLG Board cannot be trusted at all.

[city1911] 28/11/2024 14:41

SteI don't mean Aviva shareholders would be silly to reject the takeover. I mean the Aviva board would look silly. Aviva clearly want to buy DLG so surely they must have a pretty good idea their major shareholders would back it.

[pander45] 28/11/2024 14:27

Out, in profit, and happy to be so!

[stevensupertrader] 28/11/2024 14:25

City1911. - Why?
Major shareholders reject the takeover of DLG is silly . - can you give the reason(s) ? Like to see you view !!!

[city1911] 28/11/2024 14:11

Aviva would look a bit silly if their major shareholders reject the takeover.

[bountyhunter] 28/11/2024 14:09

It's more than another 10p from here.

[stevensupertrader] 28/11/2024 13:59

Aviva institutional shareholders are unhappy with this offer diluting their shareholdings .
This won’t get through as Aviva Board didn’t consult its major shareholders , the Board just testing the water only.
DLG shares will move back down imo

[laurence llewelyn binliner] 28/11/2024 13:41

The first Ageas offer was for c233 pence and raised to c237 pence, so next to squat didly of an increase..

AV cash/shares offer c250 pence rejected, they have to come back inside a month, or you take what the market offers as it is..

Not an easy one, hanging on for another 10 pence, IF it gets knocked back we could see 150 pence again PDQ same as post the AGS offer..?

[bountyhunter] 28/11/2024 12:54

They might need to offer a higher cash component.

[prokartace] 28/11/2024 12:41

'The Board considered the Proposal with its advisers and concluded that it was highly opportunistic and SUBSTANTIALLY undervalued the Company.'
Would that not indicate that the offer would have to be substantially higher? 270p is not substantially higher

[tuftymatt] 28/11/2024 12:31

Decide to let 25% of mine go at 227. Had a bunch in a GIA still with a 202 average so am happy getting out of that and will move the proceeds to my SIPP for tax relief too.

Good luck all 👍🏻

[sellhighandbuylow] 28/11/2024 11:47

If Aviva are really serious about acquiring Direct Line, they will have sweeten the terms and offer a better deal.

Institutional shareholders won't be tempted with the terms of the "indicative offer" that is for sure.

[bountyhunter] 28/11/2024 11:42

My guess is that there will be a slight higher offer which may go through but that's purely a guess, nai!

Worth noting that the Aviva share price is down around 3% to 473.7 today which makes the bid worth slightly less.

[alex1621] 28/11/2024 11:41

The DLG board rejecting the offer is standard playbook, as is the initial offer made by a potential suitor. I expect AV. to come back with a higher offer, and DLG would be foolish to reject it. The new CEO will make a bundle out of a takeover as his options will kick in. And it does no harm to his CV if he lands a deal in the interests of shareholders.

[drectly] 28/11/2024 11:38

Quite a small drop for AV considering the size of the potential takeover. I made the mistake of not getting out for a small loss on the takeover potential previously. Waiting again, as I think t/o will be higher, but a good chance I could miss my chance to get out. If in profiit fairly sure I would be sellig some. There is no logic to that but what we do. Good luck holders, it makes it interesting.

[speedsgh] 28/11/2024 11:32

Going by the AV. share price reaction this morning, one assumes that Aviva shareholders are yet to be convinced of the merits of the offer for DLG.

[anderson sw] 28/11/2024 11:28

I think a very significant difference this time versus Ageas is Adam Winslow is ex Aviva. I don't believe the bid or its figure came as a surprise to him any more than I believe Aviva were surprised by the immediate and firm rebuttal. Winslow & DLG look strong today and - it can easily be argued - are actively ensuring they do their best for existing shareholders.

Their reputations will be enhanced further when a friendly takeover at a materially higher figure than 250 is formally agreed, the terms of which will already have been set.

[garycook] 28/11/2024 11:09

Think AV will come back with around 270p !