Aviva Proposes Cash and Share Offer for Direct Line Insurance

In a significant development, the boards of Aviva and Direct Line insurance have reached an agreement regarding a cash and share offer for Direct Line. The valuation of Direct Line shares is set at 275 pence, affecting stockholder distributions.

Date: 23-12-2024

AI Rating: 6

The report details a merger agreement between Aviva and Direct Line insurance, where Direct Line shareholders will receive compensation in the form of shares and cash. Each Direct Line shareholder will receive:

0.2867 new Aviva shares
129.7 pence in cash
Up to 5 pence in dividends before the completion of the deal

This values Direct Line shares at 275 pence and the total value of its share capital at approximately 3.7 billion pounds.

Upon completion of the agreement, it is noted that Aviva shareholders will control about 87.5% of the issued and to be issued share capital, while Direct Line shareholders will hold around 12.5%. This restructuring is expected to significantly influence stock prices for both companies involved.

Stocks: AV DLG