Deal would set insurer’s valuation ahead of flotation
Travelers is in preliminary talks with Esure about buying a stake in the UK home and motor insurer, according to a report in Sky News.
The New York Stock Exchange-listed Travelers Companies Inc is believed to have held discussions with Esure’s founder and chairman Peter Wood about buying a minority stake in the company.
Any deal done before Esure’s planned flotation in autumn this year could help to establish a valuation for the insurer, which it is said would be worth at least £1bn according to market insiders if it lists on the stock market.
Wood and Travelers chairman and chief executive Jay Fishman know each other well from Wood’s ventures in the US.
Esure returned to profit last year, buoyed by rising premiums and a more cautious underwriting approach.
The insurer’s gross written premium increased 9.5% to £513m in 2011 (2010: £468m), while total policies were up 6% to 1.65m (2010: 1.56m), motor policies climbed to 1.21m (2010: 1.18m) and home insurance policies rose 16.6% to 443,000 (2010: 380,000).
Direct Line Group, which is being offloaded by Royal Bank of Scotland, and Hastings are also preparing for stock market listings in London.
Esure declined to comment.
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