Takeover offers threaten to hit Direct Line plans for flotation
DIRECT Line could see plans for a flotation dashed by two takeover bids, just weeks before its owner Royal Bank of Scotland is expected to file for the £3.2bn listing.
American private equity firms Blackstone and Bain Capital are preparing a joint bid while a consortium of Kohlberg Kravis Roberts, Apax and BC Partners is also planning an offer, The Sunday Times reported yesterday. The takeover offers are due to be made by the end of the month.
A Direct Line spokesman told City A.M. yesterday that it is still targeting an initial public offering in the second half of the year, which remains the top priority.
The EU has ordered RBS to sell Direct Line, the UK’s largest car insurer, as a condition of the bank’s £45bn bailout in 2008.
RBS needs to boost funds before the government can sell its 83 per cent holding in the bank.