Direct Line
Total cash sale proceeds £430.5m
If Direct Line’s sale of its European operations was no surprise, having been put up for sale at the interims this summer, then the price it achieved will have come as a pleasant one, exceeding all expectations.
The £430.5 million being raised compares with published estimates varying between £225 million and a little more than £300 million. The businesses in Italy and Germany are going out on about 37 times earnings to Mapfre, the Spanish insurer, if you strip out heavy one-off claims in Germany from hailstorm damage. Not bad for companies that are, in the words of one analyst, “strategically challenged”.
In Italy, this refers to the dire state of the economy. In Germany, most insurance is