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Nov. 18, 2020, 10:41 a.m. EST

RSA Insurance is a top gainer in London after $9.54 billion buyout deal

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By Barbara Kollmeyer

Deal news drove gains in London on Wednesday, with the rise led by shares of RSA Insurance, after the company agreed to a $9.54 billion foreign takeover.

The FTSE 100 index /zigman2/quotes/210598409/delayed UK:UKX -1.23% rose 0.4% to 6,391.65 The pound /zigman2/quotes/210561263/realtime/sampled GBPUSD -0.5664% rose 0.3% against the dollar. Shares of RSA were right near the top, with a gain of 4.4%.

The insurer announced an all-cash offer from Intact Financial and Tryg, which values the FTSE 100 insurer at £7.2 billion ($9.54 billion) in cash. RSA announced it had been approached by the foreign rivals earlier this month .

Under the terms of the deal , Canadian-based Intact Financial will acquire RSA’s U.K., Canadian and international assets, while Tryg will take over the Swedish and Norwegian businesses. The two will share its Danish operations.

RSA shareholders will get 685 pence in cash, a 51% premium to its closing price of 460 pence a share on Nov. 4, the last business day before a possible offer by Intact Financial and Tryg was disclosed. Tryg will contribute £4.2 billion and Intact Financial will make a £3 billion contribution, the companies said.

“A higher contribution from the Danish operations would have left Tryg more exposed to a potential sell-down due to antitrust issues. It will be interesting to see if the proposed co-ownership structure with Intact Financial is enough to appease regulators,” said Citi analyst Derald Goh, in a note to clients.

Elsewhere, Croda International’s /zigman2/quotes/206442951/delayed UK:CRDA -0.47% shares rose 1.7% after the U.K. chemical group announced a deal for Fragrance Spanish Topco — Iberchem — for €820 million ($972.7 million). The company said the deal will be funded via existing debt facilities and an equity placing.

Read: Croda is one U.K. play on Pfizer’s COVID-19 vaccine that may be overdone

Also supporting the main FTSE 100 index were banks and major oil companies. Shares of HSBC /zigman2/quotes/208272822/composite HSBC +5.52% rose 2.6% and Royal Dutch Shell gained 1.3%, with oil prices rising more than 1%.

Global stocks got a slight boost on Wednesday after drugmaker Pfizer /zigman2/quotes/202877789/composite PFE +0.72% said the vaccine candidate it has developed with partner BioNTech /zigman2/quotes/214419716/composite BNTX +0.65% was 95% effective in an analysis of clinical trial data. The companies plan to seek authorization for the vaccine in the next few days.

Read: With Brexit Talks in the Final Stretch, Boris Johnson Has Reasons to Deal

Shares of companies in the hydrogen-energy space rose after Prime Minister Boris Johnson laid out a 10-point climate plan in the Financial Times on Tuesday. Shares of Powerhouse Energy Group /zigman2/quotes/207943977/delayed UK:PHE -1.43% rose 6%, AFC Energy added 7%, and those of ITM Power rose 5%.

-87.01 -1.23%
Volume: 119,113
Oct. 5, 2022 10:12a
US : Tullett Prebon
-0.0065 -0.5664%
Volume: 0.0000
Oct. 5, 2022 5:26a
UK : U.K.: London
6,712.00 p
-32.00 -0.47%
Volume: 29,433
Oct. 5, 2022 10:11a
P/E Ratio
Dividend Yield
Market Cap
£9.15 billion
Rev. per Employee
$ 27.74
+1.45 +5.52%
Volume: 4.92M
Oct. 4, 2022 4:00p
P/E Ratio
Dividend Yield
Market Cap
$103.93 billion
Rev. per Employee
$ 44.46
+0.32 +0.72%
Volume: 28.20M
Oct. 4, 2022 4:03p
P/E Ratio
Dividend Yield
Market Cap
$247.73 billion
Rev. per Employee
US : U.S.: Nasdaq
$ 137.57
+0.89 +0.65%
Volume: 594,185
Oct. 4, 2022 4:00p
P/E Ratio
Dividend Yield
Market Cap
$33.17 billion
Rev. per Employee
UK : U.K.: London
1.04 p
-0.02 -1.43%
Volume: 7.46M
Oct. 5, 2022 8:00a
P/E Ratio
Dividend Yield
Market Cap
£40.56 million
Rev. per Employee

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