QBE still in the hunt for IAG

QBE is standing firm in its bid for a merger with IAG, further extending the deadline on its offer at the same time as agreeing to acquire a number of its own distribution channels, it announced to the Australian Stock Exchange (ASX) today.

The proposal of 0.142 QBE shares and $0.70 cash per IAG share has been extended to 5pm on May 19, QBE said.

The proposal has already been extended once before after it was not accepted by the IAG board.

QBE group chief executive officer Frank O’Halloran said: “The proposal has been extended to allow stakeholders more time to consider the impact of IAG’s profit downgrade announced last week and the value of QBE shares.

“QBE remains interested in seeing through a friendly merger with the recommendation of IAG’s board,” he said.

At the same time as QBE announced the extension, it also announced an agreement to acquire a number of its distribution channels.

“In addition to the IAG proposal, we are currently investigating other opportunities to build QBE’s business around the world,” O’Halloran said.

The acquisitions will involve around five separate transactions and are anticipated to produce additional net written premium of close to $200 million and incremental insurance profit before tax of around $70 million in 2009.

All acquisitions are expected to be completed by the end of 2008 and will be funded from existing resources.