Game on! After months of hollow predictions that the GI market was set for a new wave of M&A, RSA got the ball rolling this week with a bid for Aviva’s GI assets
Aviva knocked the £5bn offer straight out of court, but with RSA hinting at a renewed bid, there’s a fair chance of play to come.
RSA argues that Aviva’s composite model is no longer viable. But just because no one is making it work, and there are no specific capital benefits, doesn’t mean it can’t be done. With his knowledge of life and general insurance, Aviva UK chief Mark Hodges is well placed to deliver. If he gets in front of shareholders to argue his case, it’ll be compelling.
RSA boss Andy Haste is widely credited with this week’s bold attack, and he has the reputation, clout and goodwill to carry it off. Sources suggest that RSA has been eyeing the deal for up to a year, and this week’s developments were timed for maximum publicity in a quiet August and on the back of an indifferent set of results from Aviva.
However determined Aviva may be to fight off the bid, its shareholders have the ultimate say – and their decision will depend on how high Haste is prepared to go. On the other hand, what’s to stop Aviva coming back with its own bid for RSA? Either way, RSA’s attack and Aviva’s defence herald a new era in UK general insurance. IT