January 14, 2009

No sooner, it seems, had Insurance Times’ Ellen Bennett put the finishing touches to a 1500-word review of the proposed sale of Royal Bank of Scotland’s insurance operations (published in last week’s edition), than The Sunday Times pops up with the news that former Aviva man Patrick Snowball is mounting a bid for the operation which includes Direct Line, Churchill and NIG with private equity backing. In a piece entitled The Great RBS Giveaway, she argued that RBSI’s price had been slashed from £7bn to £3bn, but that still no one was interested. CVC Partners, she wrote, appeared to be the last remaining bidder, notwithstanding the loss of former bid partner Swiss Re, concluding: “If the bank does not have a realistic offer on the table by the annual general meeting in February, chances are it won’t sell ‚ but it will be looking to make the deal to free itself from the government’s grip. For CVC, if the price is anything close to £3bn, it will be worth the wait.” The Sunday Times piece (reported in the online editions of both Insurance Times and Post Magazine this week) makes no mention of a price tag ‚ though analysts suggest it could be more than £3bn ‚ but does specify that Snowball’s bid ‚ backed by leading private equity firms Apollo and BC Partners ‚ would involve retaining current incumbent Chris Sullivan as CEO.


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