Ellen Bennett outlines this week’s main events, including Chaucer’s sale, Towergate’s results and RSA’s high net worth ambitions

The story of the week has to be Chaucer: once again, the Lloyd’s insurer finds itself on the block, following an all-cash offer from US insurer Hanover (not to be confused with German reinsurance giant Hannover Re). The Chaucer management has recommended shareholders accept the offer, but the largest shareholder, Pamplona, has come out all guns blazing, claiming it is too low. Pamplona owns 9.99% of the insurer, so it doesn’t have the decisive say. Now it’s all about the other shareholders – Hanover has until June to win them over. Read Ben Dyson’s analysis of which way they are likely to jump.

Towergate releases 2010 results

Towergate-watchers always seize on the annual results with enthusiasm, and this year will be no exception. The consolidator has posted healthy numbers – EBITDA, its preferred measure, is up 18% to £138.8m, from £117.7m in 2009. It posted an after-tax loss of £14.2m in 2010, half the £28m loss it made in 2009. The results do not include the 200m cash injection from private equity house Advent earlier this year. Now that founder Peter Cullum has given up the chair to Alistair Lyons, the big question is, when will chief executive Andy Homer stand down, and who will replace him?

Jelf pays broker bosses

Jelf has been out of the headlines recently, no doubt to the relief of its management, but it made a return this week. An insurancetimes.co.uk scoop revealed that the consolidator paid around 8.7m in deferred payments to broker vendors last year, following a share issue that raised £17.7m. In a follow-up story, we revealed that Jon Manson, who sold Manson Insurance Group to Jelf in 2008, has left the board, having pocketed a healthy £2.57m for himself and his partners. He will remain a consultant to Jelf, but his departure begs the question – could he start up again elsewhere?

RSA acquires Oak

Interesting news from RSA this morning. The insurer may have failed in last year’s bid to take over rival Aviva – but it has successfully snapped up some smaller fry. It has acquired Oak Underwriting, making it a top three player in high net worth. RSA is negotiations with Oak’s current capacity provider, Brit, and is likely to be looking to bring the business in house.

RBSI: To float, or not to float?

The ‘will they, won’t they’ saga of RBS Insurance’s planned sale of flotation was given a timetable earlier this month, when RBS came out to say it would make a decision in the second half of next year. The bank wants to float the insurance business, but an Insurance Times investigation has uncovered the many difficulties it will face. The bank could even have to return to the negotiating table with European regulators if it has to float the business in tranches, rather than divest it all at once.

Buyers close in on Quinn

More than a year since it was first put up for sale, Quinn has finally been sold – or nearly. The consortium between Liberty Mutual and Anglo Irish Bank was named as the preferred bidder on Thursday, and is expected to finalise the deal within the next four to six weeks. The buyers have not taken on all of Quinn’s liabilities. Instead, claims will be met by the Irish Insurance Compensation Fund, and could result in a levy on all home and motor policies in the country. As insurancetimes.co.uk revealed, UK claims in solicitors’ PI could also be paid from this fund.

Big bucks in broking

The wrangling over contingent commissions and other additional payments to brokers in the London market has taken a new twist. As we reveal, the London Market Association has weighed into the debate, commissioning legal advice to clarify what constitutes a conflict of interest.

Ellen Bennett is editor-in-chief of Insurance Times

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