Disposal of stake in Linea Di

RNS Number : 5039R

Royal Bank of Scotland Group PLC

30 April 2009

 



The Royal Bank of Scotland Group plc announces disposal of stake in Linea Directa Aseguradora

30 April 2009

The Royal Bank of Scotland Group plc ('RBS') today announces that it has agreed to sell its 50% shareholding in Linea Directa Aseguradora ('LDA') to its joint venture partner, Bankinter, for a cash consideration of €426 million. 

The price of €426 million represents a consideration of 2.5x the tangible book value, and a price to earnings ratio of 11.9x 2008 earnings. The impact of this sale is expected to result in a net gain on sale of just over £200m.

RBS will continue to operate its Insurance businesses in the UK, Germany and Italy. 

The disposal of LDA is consistent with the strategy as announced on 26 February 2009. As a 50/50% joint venture, Linea Directa Aseguradora has operated as a largely independent Spanish insurance operation with limited connection to the Group. 

Contacts

Investors:

Richard O'Connor

Head of Investor Relations

[phone]

Media:

Neil Moorhouse                                Michael Strachan

Head of Group Media Centre         Media Relations Manager

[phone]                       [phone]

Notes to Editors

Linea Directa Aseguradora

Linea Directa Aseguradora was launched as a 50/50% joint venture with Bankinter in 1995. Since then, it has become the #6 motor insurance company in Spain and the #1 direct motor insurance provider. In addition to motor insurance, it also provides motorcycle insurance, commercial fleet insurance, and has recently launched household insurance. At 31st December 2008 Linea Directa Aseguradora had total assets of €1,016 million.

RBS Insurance

RBS Insurance sells and underwrites retail and SME insurance over the telephone and internet, as well as through brokers and partnerships. Its brands include Direct Line, Churchill and Privilege, which sell general insurance products direct to the customer, as well as Green Flag and NIG. Through its international division, RBS Insurance sells general insurance, mainly motor, in Germany and Italy. The Intermediary and Broker division sells general insurance products through independent brokers.

 

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