PUBLIC OFFERS AND PROPOSALS
IAG REJECTS QBE PROPOSAL
On 15 April 2008, Insurance Australia Group Limited (IAG) confirmed that it had been approached by QBE with an unsolicited and incomplete proposal to take over the company by way of a scheme of arrangement.
The IAG Board carefully considered the proposal and concluded that the broad terms, in particular the price, were inadequate. As a result, the Board rejected the proposal as it was clear it was not one which was in the best interests of shareholders, and therefore not one it could recommend.
The latest information on this proposal can be found below.
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Shareholder Hotline |
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ASX Statements |
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Frequently Asked Questions |
Shareholder Hotline
An information line is available for shareholder inquiries related to this proposal.
If calling within Australia:1300 658 798
If calling from outside Australia: +61 2 8986 9351
ASX Statements
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22 April 2008 IAG views of QBE takeover proposal remain unchanged [20KB PDF] |
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15 April 2008 IAG rejects QBE proposal [37KB PDF] |
Frequently Asked Questions
| Q. | What has happened? |
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| A. | On 15 April 2008, IAG confirmed that it had been approached by insurance company QBE with an unsolicited and incomplete proposal to take over the company via what is known as a scheme of arrangement. |
| A scheme of arrangement is a way of reorganising a company's capital structure to effect a merger with another company. A scheme must be agreed to at a meeting of shareholders by a resolution passed by more than 50% of the shareholders present and voting who represent 75% of votes cast on the resolution. | |
| The Board of IAG carefully considered the proposal and rejected it after concluding that the broad terms, in particular price, were inadequate and not in the best interests of shareholders. | |
| On 22 April 2008, QBE advised that its proposal had been extended until 5pm on Monday 5 May 2008. Then on 6 May 2008, QBE further extended its proposal and it is now due to expire at 5pm on Monday 19 May 2008. These time extensions have not changed IAG's views that QBE's proposal is incomplete and inadequate. | |
| Q. | What did QBE offer? |
| A. | On 10 April 2008, QBE outlined to the IAG Board a takeover proposal of 0.135 QBE shares plus 50 cents cash for each IAG share, which valued IAG at $3.75 a share. On 11 April 2008, IAG advised that the proposal was unacceptable as it did not adequately reflect the value of IAG. |
| QBE then responded with a proposal offering 0.142 QBE shares plus 70 cents cash per IAG share, representing a 1% premium based on the closing prices of both IAG and QBE on 11 April 2008. | |
| On 14 April 2008, IAG informed QBE that its revised proposal was still inadequate and did not reflect the value of IAG or the synergies available to QBE from a takeover. | |
| Q. | Why did IAG reject this offer? |
| A. | The Board of IAG carefully considered the proposal to takeover IAG by way of a scheme of arrangement and concluded that the terms, in particular the price, were inadequate. |
| IAG is a unique asset with leading insurance franchises in Australia and New Zealand supported by a number of iconic brands. Whilst the Board recognises that the synergies available through a combination with QBE are considerable, the price needs to reflect the value that the IAG businesses would contribute to QBE, including the synergies to be generated. | |
| The proposal seeks to take advantage of the current weakness in IAG's share price and does not reflect the long term prospects and value inherent in IAG. | |
| Q. | As a customer, will this affect my premiums or policies? |
| A. | No. Your policies and premiums will not be affected by these events. |
| Q. | As a holder of IAG ordinary shares, what should I do? Do I need to take any action? |
| A. | At this stage there is no formal takeover offer for shareholders to consider. The Board of IAG will advise shareholders of any updates. Until then IAG shareholders need not take any action. |
| Q. | What happens next? |
| A. | If the situation changes, the Board of IAG will advise shareholders. |
| Q. | How do I contact the IAG share registry? |
| A. | If you have any further questions please call the Shareholder
Hotline on 1300 658 798 (Australia) or |