Aviva conquers the market: premiums rise and takeover of Direct Line!

Aviva conquers the market: premiums rise and takeover of Direct Line!

Aviva presented its latest quarterly figures on Thursday and reported a 9% increase in general insurance premiums in the first quarter. This growth was largely driven by strong demand in the personal and commercial insurance sectors in the UK. In addition, the Probitas deal and new business areas contributed to the positive development. For the quarter ended March 31, Aviva reported general insurance premiums of 2.9 billion pounds ($3.9 billion). The company expressed optimism about achieving its 2026 guidance, inspiring confidence among investors. karenina.de reports that Aviva plans to acquire rival Direct Line for £3.7 billion to become the UK's largest provider of home and car insurance.

The takeover of Direct Line was finalized in November last year with a previously rejected offer of £3.3 billion. This would allow the new group to control more than 20% of the UK car insurance market, representing a strategically important expansion for Aviva. CEO Amanda Blanc emphasizes that the focus will be on customer service and competitive prices to compete in the market. investmentweek.com documented that the takeover offer includes 129.7 pence in cash per share and 0.2867 treasury shares and a possible dividend of up to 5 pence per share.

Competition authority review

The UK competition authority has already launched a review of the takeover bid, posing a potential obstacle for Aviva. However, Amanda Blanc said the takeover is firmly on track and the transaction is expected to close sometime in 2025. Following the takeover, Aviva shareholders will hold approximately 87.5% of the new group of companies, while Direktlinie shareholders will receive approximately 12.5%.

Reactions and outlook

Danuta Gray, chairwoman of Direct Line, praises the transaction as proof of the attractiveness of her company. Since March, Direct Line CEO Adam Winslow has initiated a major restructuring of the company to best position it for the merger. He sees the combination of the two companies as an opportunity to create a stronger and competitive business, despite the announced £100 million in savings and the loss of 550 jobs. The shareholder vote on the merger is scheduled for March, which would represent a significant step in the merger process.