NatWest Confirms Talks for $10.75 Billion Takeover of Legal & General

Strategic Insights -

Shares in Norwich Union skyrocketed nearly $900 million as industry sources revealed that the insurer is the next potential takeover target in the financial services sector. NatWest's bid for Legal & General would be the biggest takeover in the UK's financial services industry, with analysts warning that the move could trigger a bidding war for L&G. A merger between the two companies would see David Prosser, L&G's chief executive, join the NatWest board to run the retail banking and life assurance business.

Key Takeaways:

  • NatWest has confirmed talks for a $10.75 billion takeover of Legal & General, which would be the biggest takeover in the UK's financial services industry.
  • Industry sources say that Norwich Union is the next potential takeover target, with shares soaring nearly $900 million on speculation.
  • Analysts warn that the move could trigger a bidding war for L&G, with potential rival bidders including Aegon, Allianz, and Generali.
  • NatWest's bid would see David Prosser, L&G's chief executive, join the NatWest board to run the retail banking and life assurance business.
  • The two companies have already agreed on the shape of the senior management team, with Sir David Rowland, NatWest's chairman, and Derek Wanless, its chief executive, retaining their current jobs.
  • Norwich Union's spokesman said that the company does not comment on market rumors, but believes it has a strong and independent future.

Statistics:

  • $10.75 billion: The proposed takeover bid by NatWest for Legal & General.
  • $900 million: The increase in Norwich Union's stock market value on speculation that it will be the next takeover target.
  • 11%: The increase in Norwich Union's stock market value.
  • 474p: The peak share value of Norwich Union.
  • 210p: The proposed offer price by NatWest for L&G.
  • 41.7 million: The volume of shares traded in L&G on Thursday.
  • 13p: The increase in L&G's share price to 205p.

Sources:

  • NATWEST
  • COMMERZBANK
  • TEATHER & GREENWOOD
  • AEGON
  • ALLIANZ
  • GENERALI
  • HALIFAX
  • ROYAL BANK OF SCOTLAND
  • TELEGRAPH