RBS has extended the deadline for the first round of bidding in its auction of the companies insurance business. The extension was called after several bidders allegedly aborted their interest, while others need more time to consider their bids.
Italian insurance giant Generali, thought at one time to be a forerunner in the auction were the first of the remaining businesses to pull out.
Ping An the Chinese insurer followed Generali’s lead and pulled out of the auction today, leaving five interested parties. Zurich, Allstate, Allianz, Travelers and American International group remain in the frame.
Investment bank Landsbanki Kepler has questioned the value RBS has placed on key targets Direct Line and Churchill, suggesting that eight to ten times the earnings for a UK motor business seemed a bit steep in a volatile market.
It is thought that RBS may reconsider its exclusion of bidding from Private Equity firms allowing them to make joint bids with interested insurance companies.
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