Intact Financial Corporation and Tryg to Acquire International P&C Insurer RSA Insurance Group

Posted on 11/18/2020

Canada-based Intact Financial Corporation and Tryg A/S reached an agreement with RSA on the terms of a recommended all-cash acquisition for the entire issued and to be issued share capital of RSA Insurance Group plc at a price of 685 pence per common share, representing a total consideration of approximately £7.2 billion (US$ 12.3 billion). Some of RSA’s largest shareholders include Cevian Capital AB, UBS Asset Management (UK) Ltd., and Threadneedle Asset Management Ltd.

Intact will pay US$ 5.1 billion (£3.0 billion) of the total consideration payable and Tryg will pay US$ 7.2 billion (£4.2 billion). In addition to the cash consideration payable, RSA shareholders will also be entitled to the previously announced but unpaid interim dividend of 8 pence per share. Pursuant to the transaction, Intact will retain RSA’s Canadian, UK and International (“UK&I”) entities, Tryg will retain RSA’s Swedish and Norwegian businesses, and Intact and Tryg will co-own RSA’s Danish business.

The agreement to announce the Transaction has been recommended unanimously by the boards of directors of all three companies. The Transaction is subject to customary regulatory and shareholder approvals.

Intact will be acquiring RSA’s Canadian and UK&I operations and co-owning the Denmark business for $5.1(£3.0) billion which represents an estimated 0.9x price to book value multiple based on balance sheet data as at June 30, 2020.

Acquisition Financing

Intact intends to finance the US$ 5.1 billion acquisition and US$ 0.7 billion of additional related transaction costs for RSA’s Canadian, UK and International operations, and Intact’s share of RSA’s Danish operations with:

$4.45 billion of private placement subscription receipts as previously announced on November 12, 2020;
$0.6 billion bank term loan facility entered into on announcement; and
a bond bridge facility that Intact intends to refinance with $0.8 billion of medium term notes and preferred share issuances.
As part of the acquisition, Intact also intends to assume the full amount of RSA’s outstanding issued debt and hybrid securities which total £0.8 billion ($1.3 billion) and £0.4 billion ($0.7 billion), respectively.

Tryg intends to provide US$ 7.2 billion (£4.2 billion) for its purchase of RSA’s Norway and Sweden operations, and Tryg’s share of RSA’s Danish operations, using proceeds of a fully underwritten rights issue to be launched before acquisition closing.

The total funds of $12.3 billion (£7.2 billion) for the acquisition of RSA have been structured to ensure compliance with the “certain funds” requirements of the UK City Code on Takeovers and Mergers.


Barclays Bank PLC, acting through its Investment Bank, is acting as lead financial adviser to Intact. Clifford Chance LLP is acting as English law legal adviser, Blake, Cassels & Graydon and Torys are acting as Canadian law legal advisers, and Gorrissen Federspiel Advokatpartnerelskab is acting as Danish law legal adviser. CIBC Capital Markets is also acting as financial adviser to Intact.

Intact Financial Corporation is the largest provider of property and casualty (P&C) insurance in Canada and a leading provider of specialty insurance in North America, with over $11 billion in total annual premiums. RSA is a focused international insurance group, with strong positions in the large general insurance markets of the UK, Scandinavia and Canada, together with supporting international business in Ireland, Continental Europe and the Middle East. Tryg is one of the major non-life insurance companies in the Nordic region with activities in Denmark, Norway, and Sweden.

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