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March 8, 2024
November 28, 2024
Direct Line's share price surged by over 30% after the UK-based insurer rejected a £3.3 billion takeover proposal from Aviva.
The offer, a mix of cash and shares, represented a 60% premium on Direct Line's stock price prior to the bid on November 18.
However, the company dismissed the offer as "highly opportunistic," arguing it significantly undervalued the business.
This rejection marks Direct Line's second defence against a takeover this year, following a £3.17 billion approach from Belgian insurer Ageas.
Despite its challenges in the motor insurance sector, including rising claims costs and competition from leaner online players, Direct Line remains committed to its turnaround plan.
Recent initiatives to streamline operations include cost-cutting measures and 550 job losses aimed at improving efficiency.
Analysts speculate that Aviva or other rivals could return with an enhanced offer, particularly given Direct Line’s valuable brand portfolio, which includes Churchill and Privilege.
Source: Sky news
