Business

Norwegian insurer cuts FBD stake below 3%

Protector Forsikring’s 2021 emergence on FBD shareholder triggered takeover speculation, quickly denied by Oslo-based firm

FBD chief executive Tomás Ó Midheach signalled the company was looking to make a second special cash distribution to investors, after its planned payment of €36 million in regular dividends. Photograph: Alan Betson

Joe Brennan
Wed Mar 13 2024 - 12:03

Norwegian insurer Protector Forsikring, which became the second-largest investor in FBD two years ago after building up a 10.2 per cent stake, has cut its holding below the 3 per cent level, according to a stock exchange filing.

A disclosure from Protector Forsikring in early 2021 that it had taken an initial 6.3 per cent stake in FBD led to a spike in the Dublin-listed company’s share price, amid speculation a takeover bid could be in the offing.

However, the Oslo-based company clarified at the time that it was not a strategic investment and that the stake would be held in its own investment portfolio, which then had the equivalent of €1.5 billion of assets under management.

Protector Forsikring has gradually reduced its holding over the past two years, dipping to 2.73 per cent this week. That takes it below the key 3 per cent threshold where investments must be disclosed to the stock market.

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The Norwegian firm’s chief investment officer Dag Marius Nereng declined to comment on the stake reduction.

Shares in FBD are currently trading at €12.80, double the average price at which they were changing hands when Protector Forsikring was first in the market three years ago.

Farmer Business Developments owns about 21 per cent of the company, while FBD Trust Company owns a further 14.2 per cent. Waste entrepreneur Eamon Waters’s family office investment firm Sretaw Private Equity has a 10.9 per cent interest.

FBD chief executive Tomás Ó Midheach signalled last Friday the insurer is looking to make a second special cash distribution to investors, after its planned payment of €36 million in regular dividends for a third straight year as it posted a strong set of results.

The State’s only indigenous general insurer issued a €36 million top-up to shareholders last October as it looked to reduce its excess capital reserves. Goodbody Stockbrokers analyst John Cronin estimates FBD had almost €120 million of surplus cash above the company’s capital reserves target.

FBD’s pretax profit last year rose 24 per cent to €81.4 million. The company had already said in early February that the result would amount to about €80 million, much higher than the consensus estimate of almost €55 million among analysts at the time. It was the third year in a row that FBD guided analysts’ expectations sharply higher in the run-up to the unveiling of results.

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times

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