LATEST: Hastings Direct agrees to a £1.66 billion takeover

Hastings Group Holdings, the Bexhill-based insurance giant, is set to be taken over in a deal valuing it at £1.66 billion.

The company has accepted an approach from Dorset Bidco – a consortium made up of its main shareholder, RMI, and Sampo, the Finnish insurer.

There was no mention in the stock market announcement about how the deal could affect the 3,400 people employed in Bexhill, Leicester, Gibraltar and London.

However, a spokesperson for Hastings insisted the consortium liked the company’s ideas and strategy, and would support its growth ambitions.

“Should the transaction complete, the consortium would like to keep Hastings unchanged and there would be very little, if any, day to day change for colleagues or for our locations.”

Under the terms of the offer, which still requires regulatory approval, Hastings Shareholders would receive 250 pence for each share.

This represents a premium of approximately 47.1% over the 170p closing price of Hastings Shares prior to the announcement of an approach.

Herman Bosman, chief executive officer of RMI, said he was excited about the prospects of the business and believe it would thrive in a private environment.

“We strongly believe this transaction is in the best interest of all Hastings stakeholders including its customers and many talented employees,” he said.

Thomas Colraine, chairman of Hastings, said: “I am pleased to announce the recommended cash offer for Hastings which represents a very attractive proposition for Hastings shareholders with a significant premium in cash.”

According to Andreas van Embden, an analyst at Peel Hunt, Sampo is likely to own 70% of the Hastings shares and RMI 30%, but with the option to increase this to 40%.

“Sampo is looking to diversify its insurance business outside the Scandinavian region and has identified the UK market as the most digitally-advanced insurance market,” he said.

Hastings Group, which was founded in 1996 and has its headquarters in Collington Avenue, offers a range of insurance products and services.

It has more than 2.7 million live customer policies.

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