Chaucer holding takeover talks according to chairman

Lloyd’s of London personal and commercial insurance provider Chaucer has announced that it has been in discussion with interested parties regarding takeover, says chairman Martin Gilbert.

UK private equity group Terra Firma has been the only party to give confirmation of its interest in the business insurance group. This is despite the rumours that have persisted for weeks that a professional indemnity insurance provider from the US was interested, along with other buyers of private equity.

The Guy Hands-founded equity group initially stated that it would consider offering as much as 65p per Chaucer share, which would value the group at £355 million. However industry insiders recently stated that the company would be in luck if it could secure an offer of higher than 60p after lacklustre results were announced recently.

Profits before tax at Chaucer stood at £32.9 million.  This was 22 per cent less than its 2009 figure of £42 million, which had taken into account a loss of £54 million.  This was in spite of Chaucer experiencing an increase of nearly 7 per cent in its gross written premiums to nearly £850 million.

The net tangible asset value of the company went from 55.5p down to 53.9p, and its shares tumbled 0.5p recently to 58.5p.

Mr Gilbert stated that the firm has received several takeover approaches that are currently being investigated closely.  Only time will tell whether there will be a forthcoming offer for the business, the Chaucer chairman added.  The firm continues to hold discussions with parties interested in buying out Chaucer with an eye to maximising shareholder value.

The financial crisis hit Chaucer hard due to not only the potential losses its professional liability insurance syndicate suffered but also through its own investments.

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