R&q Insurance Share Discussion Threads

[red ninja] 20/5/2022 15:47

Well if Slaters wanted to really commit to twisting Bricknells arm, I'm thinking why did they not buy more in the markets.

Thus, I'm not convinced they would devote $100 million to RQIH bailout.

Slaters, doubled up at cheaper prices so even if they fail to resist Bricknells, they've increased their payout.

[simon gordon] 20/5/2022 15:43

If they didn't need $100m Slater could block the deal. He's got no leverage.

[simon gordon] 20/5/2022 15:41

Thing is they need $100m to repair the balance sheet. Unless Slater can raise $100m he's got nothing to offer. The majority of shareholders don't want to put any more money in. He's looking a bit stupid. He either gives them $100m or votes to the deal going through. Otherwise the company is in limbo and the rating agencies will be on their case.

[red ninja] 20/5/2022 15:40

Simon,

I'm thinking we'll see buying in the market on Monday.

The accepters should be able to out buy Slaters if they decided to contest it.

[red ninja] 20/5/2022 15:38

afilip,

It's a possibility, but it would seem that they are going for the 175p buy out.

If Slaters don't think they can win they may just throw in the towel.
It's not a good result, but Slaters and everyone else will get 50p more a share.

[simon gordon] 20/5/2022 15:36

Red,

I also bought some as well.

Slater is up against a serious deal maker in Spiegel.

[afilip] 20/5/2022 15:35

Let's not forget that the bidder can also switch to a takeover offer and lower the acceptance threshold...

[red ninja] 20/5/2022 15:32

Just bought a few more at 125p as it may not be a good result but, I'm thinking that they think there is a good chance of taking it over the line next week.

I mean funds voting for the deal just have to increase their holdings and the reward is around 50p a share.

[simon gordon] 20/5/2022 15:25

Looks like Slater is on his own.

Doesn't look like he has a plan to raise $100m.

What can he do?

[red ninja] 20/5/2022 14:25

The meeting started at 2:00pm so I'm hoping that we'll get the result by RNS today.

The price seems to be falling so some people are not waiting around to find what the official result is.

Having said that there are plenty of buys listed so maybe the optimists are right.

[3800] 20/5/2022 13:39

Wonder when the result will be announced? I know everyone is dissapointed with £1.75 but it may be the best alternative

[simon gordon] 19/5/2022 17:17

afilip,

Yes, a glaring omission.

-----

Meeting's at 2pm tomorrow.

[afilip] 19/5/2022 13:33

No mention of the $100m hole in the balance sheet in that IC article!?

[varies] 19/5/2022 11:40

In the meantime RQIH shares trade at a 30% discount to the cash offer

[simon gordon] 19/5/2022 05:50

Investors Chronicle - 18/5/22:

The holding in danger of falling into private equity’s maw is in insurance specialist Randall & Quilter Investment Holdings (RQIH). This Friday (20 May) R&Q’s shareholders will vote on whether to accept a 175p-per-share cash offer from 777 Partners, a Miami-based private equity house perhaps best known in Europe as the owner of Italy’s oldest football club, the perennially under-achieving Genoa CFC.

Then again 777’s offer, which values R&Q’s equity at £482m, might well fail. R&Q’s second-biggest shareholder, Slater Investments, which owns almost 10 per cent, says it will reject the offer and the share price has responded accordingly. It is back to 140p, the level at which 777 made its move. At a 20 per cent discount to the offer, essentially the market price is saying “Come up with a lot more than 175p or shove off back to Miami”.

There is no getting away from it, 777’s offer is underwhelming. It is at a level R&Q’s shares almost touched in February, is 7 per cent below the 12-month high and 10 per cent lower than October 2019’s all-time high. As such, the directors’ recommendation is redolent of the inadequate offer earlier this year for specialist travel agent Air Partner, another Bearbull holding, which was recommended and blithely waived through by shareholders. In both cases, the offer was below recent highs and – more important – was recommended even though each group’s trading was good and its prospects were better.

As with Air Partner, R&Q’s directors are keen to tell shareholders that 777’s offer “demonstrates the strength of both our business today and the opportunities ahead of us”. In which case, runs the thought, why on Earth are you recommending such an inadequate offer?

Sure, it’s tricky to value R&Q. Partly, that’s a function of how insurance companies operate, generating most of their income upfront and only meeting the associated costs at some indeterminate point in the future, if at all. That is chiefly why insurers are valued in relation to the net assets on their balance sheet; at least that provides hard and fast figures from which to start. Even on that basis, 777’s offer at 1.8 times estimated net tangible assets at the end of 2021 is tight-fisted. A ratio of at least 2.0 times would be more like it.

Meanwhile, R&Q is in the process of transforming itself from a capital-intensive conventional non-life insurer into a capital-light fee-based business. When that’s mostly done, it may be generating $90m (£74m) of operating profit in 2023, which could feed down to 15p of earnings. Rate those earnings at the sort of multiple on which shares in full-service insurance brokers trade – maybe 20 times – and a share price of 300p is within reach. Granted, that’s a top-end value. Even so, it highlights the inadequacy of 777’s offer. Whether enough shareholders will see it that way will soon be known.

[my retirement fund] 18/5/2022 12:12

wow look at this what a sham!

[simon gordon] 17/5/2022 14:22

Vote on Friday. No sign of Brickell upping their offer to placate Slater. JO Hambro reduced on the uncertainty. Nearly 40p upside if the vote goes through. If not will Slater pony up $100m to strengthen the balance sheet or can they get other investors to club together? Is it causing bad blood between BoD and some sharehodlers?

[red ninja] 06/5/2022 13:47

RQIH linked in feed :-

"We are honoured to announce that Gibson Re, R&Q’s legacy insurance sidecar, was awarded ‘Non-life Transaction of the Year’ at the Trading Risk Awards 2022 held at The Savoy last week. The award recognises transactions which break boundaries in risk transfer and is testament to R&Q’s leading Legacy Insurance platform, and the exceptional efforts put in by the entire team.

Huge congratulations to all colleagues who worked towards making this achievement possible, and a massive thank you to Trading Risk for hosting us!"

[red ninja] 01/5/2022 10:28

If the vote fails then we may be looking at a share price crash and a placing at a much lower price to existing fund holders ie like Slaters, maybe Bricknells, and new comers.

That is not going to please PIs. I can't see the funds being wildly happy about it either. Thus, the logical solutions is the funds to come to a deal to get the vote over the line.

Just my thoughts.

[martindjzz] 30/4/2022 16:07

Brickell will not make a better offer if they think enough shareholders are going to vote for the offer on on the table. They might improve their offer if they think 25% or more of the shareholders are going to vote against.

[red ninja] 30/4/2022 10:19

Mmm If there was going to be a better offer wouldn't they would have made it by now ?

The Times article suggested that some of the funds like Slaters were unhappy that they could not participate in the extra funding for RQIH as they do not want to sell out.

Slaters have doubled to 10% and Bricknell although they have 23.2% of RQIH only have 9.9% of the votes. The management/management family also support the bid with 3.31%

Thus, they must have been lobbying the funds to get them on board for this vote. They may have to come to agreement with some funds to let them participate in the new company if that is their price to get the vote over the line.

Just my opinions. DYOR

[alter ego] 29/4/2022 15:41

Just been asked by my broker to accept or decline by noon on 13 May. What happens if I accept and a better offer comes along?

[alter ego] 21/4/2022 11:56

I second that

[geraldus] 21/4/2022 10:20

Let's hope so.I had high in the sky hopes for this one.