Den Norske Bank Reportedly Seeking Storebrand

May 29, 2002

According to several news reports, Norway’s largest financial institution, DnB Holdings, which is 47 percent government owned and includes Den Norske Bank, is seeking to acquire Storebrand ASA, the country’s largest insurer.

DnB acquired a 10 percent stake in Storebrand a year ago, and has been interested in acquiring the insurer since then, but Storebrand received a better offer from Finland’s Sampo, which was accepted by its board of directors.

Den Norske fought against Sampo’s bid for most of last year, relying on thinly disguised government backing to keep control of Storebrand in Norwegian hands, and was ultimately successful in blocking the acquisition thanks to a regulation that requires 90 percent shareholder approval in such cases.

DnB refused to accept Sampo’s offer, and the government refused to change or waive the law.

While no details have yet been released on the new bid, DnB originally offered 62 Nkr per share, valuing Storebrand at around $2.12 billion. Sampo’s bid of Nkr 75 per share valued it at around $2.57 billion. However, Storebrand posted a net loss last year of $173 million, and its market value today is estimated at less than $2 billion.

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