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Insurers motor higher as esure “minded to recommend” £1.2bn cash offer from Bain Capital

Published: 11:32 13 Aug 2018 BST

car crash
esure's peers Admiral and Direct Line immediately jumped to the top of the FTSE 100

Shares in Esure Group PLC (LON:ESUR) surged on Monday morning after the home and motor insurer told investors it is “minded to recommend" a £1.2bn cash offer from Bain Capital.

The offer hasn’t been formalised just yet, but esure, which is due to report its half-year results tomorrow, said the two parties are in “advanced stages” of negotiations.

READ: Deutsche Bank ups esure to ‘buy’ from ‘hold’, highlighting strong growth and compelling value

Should Bain follow through with its proposal, it would represent a 37% premium to Friday’s closing price of 204p.

“The board of esure has indicated to Bain Capital that it would be minded to recommend a firm offer for esure if made by Bain Capital at the price set out in the proposal,” read a brief stock exchange statement.

Bain has until 5pm on September 4 to either announce a firm intention to make an offer or withdraw from the process altogether.

News of the possible takeover sent esure shares soaring by 30% to 263p. Other insurers also leapt higher, with Direct Line Insurance Group PLC (LON:DLG) (up 2.2% to 329.7p) and Admiral Group PLC (LON:ADM) (up 1.3% to 2,013p) immediately climbing to the top of the FTSE 100.

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