Cash deal comes with promise of more disposals over next 18 months.
RSA has sold its Singapore and Hong Kong branches to Allied World for £130m in cash, made up of £93m for the former and £37m for the latter.
Both operations underwrite a mix of commercial specialty and retail business and senior management are expected to remain with the respective businesses at completion.
Net written premiums for RSA’s operations in Singapore in 2013 were £66m with a pre-tax profit of £12m. In the same year Hong Kong had net written premiums of £47m with a pre-tax profit of £5m.
The deals, which are not dependent on both occurring, are subject to regulatory approval and are expected to complete in the first half of 2015.
According to the provider, the disposal of RSA Singapore and RSA Hong Kong will result in a net gain of £110m and an addition to the its tangible net assets of approximately £95m, further improving the group’s capital strength.
Stephen Hester, RSA group chief executive, said: “This transaction builds further on the momentum of our recently announced disposals in the Baltics, Poland, Canada (Noraxis) and China, and represents continued progress against our aim of tightening the strategic focus of the group.
“Further disposals are targeted over the next 12-18 months to complete this process.”
Author: Emmanuel Kenning
Source: IA | 22 Aug 2014