Novae could be next to go – analysts

Novae is the most likely listed Lloyd’s player to be taken over after Chaucer, according to analysts.

The most obvious bargains among the remaining listed Lloyd’s players are Novae, Omega and Catlin, as their shares are all trading at discounts to their 2010 net tangible asset value per share.

However, Novae is analysts’ favourite. Some feel the company itself would welcome an approach. “The company that is obviously open to a deal is Novae,” said Collins Stewart analyst Ben Cohen.

Panmure Gordon analyst Barrie Cornes agrees. “I don’t think shareholders would be that unhappy to be taken out at Novae and get something like net tangible asset value,” he says.

Catlin is deemed to value its independence, while Omega’s future ownership is currently unclear. It was approached by Canopius at the beginning of this year and has since said it has received other approaches, but no deal has yet materialised.

Chaucer approved an offer from US insurer Hanover Insurance Group on 20 April, and a deal is considered likely to go through.

For more on which Lloyd’s insurer could be snapped up next, read this week's spotlight on the London Market: IT Spotlights London Market: Novae is sale favourite.