Shares in U.K. insurer Royal&SunAlliance have risen sharply since rumors surfaced on Friday, June 10, that British financier Andrew Regan is considering a takeover offer for the U.K.’s second largest general insurer.
R&SA has been heavily impacted by accelerating reserve requirements in the U.S., which resulted in a sharp reduction in its operations there. But a drastic restructuring plan, implemented by CEO Andy Haste, has put the insurer back on the road to recovery. It announced net profits for 2004 of £1 million ($1.83 million), and is continuing the orderly runoff of it U.S. business.
Haste said at the time of the earnings release: “2004 has been a year of substantial progress for the Group. We’ve driven strong operational performance and delivered against the strategic commitments we set out for the Group eighteen months ago. Our strategy for the future is clear – to run general insurance businesses where we have strong market positions and where we can deliver sustainable profitable performance.”
Trading in shares of Regan’s investment vehicle Corvus Capital have been suspended at his request, “pending an announcement.” Their value has risen more than 40 percent since the takeover rumors first appeared. According to news reports, Regan recently made a trip to the U.S. to arrange financing for the bid.
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