Aviva pushes to seal Direct Line deal before Christmas
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Aviva and Direct Line have been locked in takeover talks over the weekend ahead of a Christmas Day bid deadline. FTSE 100 insurer Aviva has until 5pm on December 25 to make a firm offer, agree an extension or walk away after swooping on its smaller rival last month.
Direct Line's board has told shareholders that it would back a sweetened £3.6billion takeover offer after rejecting an earlier £3.3billion approach. That marked the third bid for the troubled insurer in less than 12 months, with Direct Line – which also owns Churchill and Green Flag – having fended off a takeover attempt by Belgian rival Ageas this year.
And it came as a further blow to London's stock market which has seen a mass exodus of companies in 2024. The insurers are expected to update the market by tomorrow. Following the proposed deal, Direct Line shareholders would own approximately 12.5 per cent of the enlarged group, which would be the UK's second largest car insurer behind Admiral.
Crunch talks: Aviva boss Dame Amanda Blanc. Direct Line chief executive Adam Winslow joined the struggling company from Aviva in March with a target of turning the firm's fortunes around. He replaced Penny James who was ousted following a profit warning. Winslow has cut costs by £100m by focusing on core businesses and axing 550 jobs. On Friday he announced a deal with Compare the Market, the comparison site that was run by his father Peter Winslow.
He also previously set out a plan to pay out roughly 60 per cent of operating profits as regular dividends. Aviva boss Dame Amanda Blanc's attempt to snap up Direct Line pits her against her ex-colleague. The two are said to have 'bad blood' after Winslow left Aviva for Direct Line.
