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Daily Insurance Industry News
Thursday 16th of August 2018
May 31, 2008

Ping An withdraws from RBS Insurance sale

by Gill Montia

Story link: Ping An withdraws from RBS Insurance sale

Ping An withdraws from RBS Insurance sale Ping An withdraws from RBS Insurance sale

Bidders for Royal Bank of Scotland’s (RBS) insurance business are now down to five.

Ping An, has withdrawn from the contest, leaving Zurich, Allstate, Travelers, AIG and Allianz to battle it out.

Ping An had been tipped as a strong candidate for a successful acquisition of the business, which could have provided the Chinese insurer with opportunities to diversity and develop its Internet presence.

Royal Bank of Scotland Insurance is estimated to be worth around £7 billion. The sale includes the Churchill and Direct Line brands but excludes a Tesco joint venture.

RBS is keen to complete the disposal, which should help to appease shareholders who are unimpressed by the bank’s decision to launch a £12 billion rights issue.

The group has already made it clear that it is willing to split up the insurance business to achieve a sale.

RBS is also selling Angel Trains, its rolling stock leasing company, and the disposal programme will have been put under additional pressure by the news that Moody’s Investors’ Service has rated credit conditions in the UK banking system as negative.

At worst, the Moody’s report could deter shareholders from engaging with the rights issue and raising the equity capital the group needs.

 

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