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Insurer RSA agrees £300m of disposals

STEPHEN Hester's turnaround programme at insurer RSA is gathering pace as it agrees a £300 million deal to offload operations in the Baltics and Poland.

The former Bank of Scotland chief is embarking on a major shake-up of RSA as the insurer seeks to boost its capital base and move on from an accounting scandal at its Irish unit.

Through the deal finance firm PZU, controlled by the Polish state and already central and eastern Europe's largest insurer, has snapped up Lithuania's biggest insurer, Lietuvos Draudimas, Latvian rival AAS Balta, an Estonian unit of RSA's Danish insurer Codan Forsikring and Poland-based Link4.

It marks PZU's biggest-ever deal.

RSA said further disposals were likely as it repositions the business to focus on core markets in the UK, Ireland, Scandinavia, Canada and Latin America.

Mr Hester said: "We will continue to evaluate further non-core disposals, some of which we expect to occur during 2014."

Tom Dorner, analyst at Citi, said: "I think it's a very positive disposal. They've achieved a higher level of proceeds than I think the market was expecting,"

Shares in RSA closed up 2.1p, or 2.27%, at 94.7p.

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