Direct Line Insurance Share Discussion Threads

[prokartace] 06/12/2024 11:23

There is a lot of talk about the discount to the offer price. We should not forget the 5p dividend which makes the effective current offer 280p. Discount is therefore approaching 10%. However there has not been an offer yet and if there isn't then we are trading at a premium of 57% to the expected future price

[fenners66] 06/12/2024 11:09

EdmundJ was that post mostly your words ?
Or did you lift that from Socialist Worker or some such ?

You have majored on the combination being 20% of car insurance and have acknowledged that this is less than Admiral - but of course have not said how much of the market is Admiral - is it 25% already ? I thought I had heard that number. CMA is not investigating Admiral at that % so no reason to look at Aviva.

Admiral anecdotally is alleged to be the cheapest on the market atm.

[stevensupertrader] 06/12/2024 10:24

As the market share is less than 25% or about - this will not be referred and it will be ok except a tiny risk that Aviva might wake up on next morning and decide otherwise . My view it will move to £2.60 very very soon .all my chips are on the dLg to be taken over .IMO

[laurence llewelyn binliner] 06/12/2024 10:16

#Bountyhunter, 253 pence seems to be too cheap to me, perhaps 260 pence would be fairer as the risk premium is still there until a firm offer arrives, then there is the CMA if they want to run a rule over it but market share is less than 25% combined..

If there are opportunities to book stronger dividends at a discount over December then it does make sense to let them/some of these go, I keep sight of this and not wedded to the share, it has been a poor investment since coming into DLG in 2021 for the dividends and that has not gone so well.. :o)

See what the market bid offers up over the day/week/month..

OR just ride it out, take the next 5 pence FY dividend here and convert to AV stock at 7% income on completion..

[my retirement fund] 06/12/2024 09:56

Direct line has provided approx 250p in dividends since it floated in 2012. It's initial shareprice was 203p so it's final shareprice will be 30% higher after it's 12 year history.I suspect it may take Aviva a lot longer to get it's money back for this offer.Aviva investors must be feeling fairly sick.

[yump] 06/12/2024 09:51

But I guess it would be fine if a massive foreign insurer took over because that would be “inward direct investment in the UK”.

[bountyhunter] 06/12/2024 09:42

I agree LLB, I'll be holding as well at least with the price at this level. I assume that the firm offer still needs to be made before 25th which should reduce the risk premium and I can't see it being left that long.

[stevensupertrader] 06/12/2024 09:42

DLG Boarand major shareholders have accepted this proposed offer by Aviva - Aviva needs to confirm it and sign in the dotted line by 25 Dec. then everything is done . Therefore until the FAT LADY sings then the curtain is down and the show is ended., so there is still a very tiny risk that Aviva might ………;.. but very unlikely therefore every chip of mine is place on Red as the ball is on the red number on the rollette wheel however the wheel still slowing spinning and until the wheel stops then the payout is made.

[wba1] 06/12/2024 09:11

At 252 the risk discount to the offer price at 9% does look too big. I assume Aviva are now entering a data room and will take close to the remaining 2 weeks and a bit to confirm the bid, but some risk does remain (as well as time cost to completion) so a 5-6% risk/time discount is justified meaning it should be 260 or so, and I would take that. Some risk does remain, especially if DLG still have some weakness or uncertainty around their prior year reserves so I do not want to be greedy.

The only disappointment in all this is that we do not get another bite at the cherry as happened after Ageas. With no other focused retail general insurers other than Sabre on the market the game is pretty much over in this sub sector. Good luck to all and enjoy the profits.

[pete160] 06/12/2024 09:10

The proposed deal still has to get competition authority clearance, although presumably Av. has already sought some initial guidance?
(So long as the politicians don't get involved, it'll be fine!)

[neilyb675] 06/12/2024 08:58

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[laurence llewelyn binliner] 06/12/2024 08:45

#Bountyhunter, that has worked out well or will do for holders, 253 pence is not enough to shake shares out of my hands this morning, not with 275 pence to come and the next DLG 5 pence dividend in May..

There will of course be holders selling into the news this morning, once they clear we should push on again towards a stronger price..

See what the market offers nearer the AV offer price perhaps, there is the opportunity cost to consider if bigger dividends can be booked at a discount between now and completion, otherwise (tbc but H1-2025), a PX into AV stock and 7% income is fine by me.. :o)

[stevensupertrader] 06/12/2024 08:24

The offer is £1.297 cash and 0.2867 Aviva shares plus 5p dividend on completion of the deal - valuing DLG at £2.75 per share

[nellynell] 06/12/2024 08:16

Topped up myself always a chance of another bidder now the sale sign has been put up

[bountyhunter] 06/12/2024 08:06

253/254, some way to go! Maybe I'll top up.

[bountyhunter] 06/12/2024 07:56

Yes it will rapidly rise to approaching 270p imv (assuming AV. doesn't open lower which it it may do) as although effectively agreed there will be a small risk premium.

[stevensupertrader] 06/12/2024 07:50

Waiting for the dotted lines to be sign off . - Good Luck for those that hang on and waited for this . Happy Days

[stevensupertrader] 06/12/2024 07:48

Deal is sealed and done imo as RNS announced an joint agreement between Both Aviva and Direct Line Offer of £2.75 (mix of cash £1.297 and and shares)Using Aviva Share Prive at closed of trading yesterday at £4.89.7 -
DLG will jump at start of opening bell in 10 minutes time .
👍🏻 👍🏻

[carpingtris] 06/12/2024 07:32

Good result - not much more to say :)

[chriss911911] 06/12/2024 07:30

Okay then I can drop 5p off, 275p it is, deal. Certainly is a very merry Xmas, lovely jumbly, what a result for holders, especially those who held out for the right price, well done, patience is a virtue.

[laurence llewelyn binliner] 06/12/2024 07:29

There we go, worth being patient and not taking the 235 market bid last week and it looks like holders would get the next 5 pence DLG final in May as well if you stay the course before a PX into AV stock..Nice result for Xmas..

[tuftymatt] 06/12/2024 07:28

Yeah it seems a fair and reasonable deal for both sides.

I wish I hadn't trimmed into strength now but after the fiasco in the spring it made a lot of sense at the time.

Good luck all 👍🏻

[huckers] 06/12/2024 07:27

Well done holders. Thought I had done well exiting on the spike yesterday at 251p. I expect this morning you can get out now around 261p (about a 5% discount to the offer price). Are there still risks the CMA might be awkward now regarding market shares of the combined entity?

And thanks to wba1 for his insightful posts.