Bain Capital snaps up 19.9pc stake in New Zealand’s Tower Insurance as Suncorp exits at a loss
Bain Capital’s credit arm has acquired Suncorp’s stake in Tower Insurance after attempts by the Australian insurer’s subsidiary to take over the New Zealand business were blocked by the competition watchdog.
Shares were bought at NZ80 cents each (74.4c) by Bain Credit, valuing the total 19.9 per stake at $NZ53.9 million ($50m).
Shares (TWR) closed on Wednesday at 72.5c each.
The holding was owned by Suncorp (SUN) subsidiary Vero which last year made a takeover bid for the New Zealand insurer Tower, which is also listed in Australia.
Suncorp’s average price paid to acquire the business was NZ91c as a result of the participation in Tower’s rights issue last December, buying shares at NZ42c each.
Vero offered $NZ1.40 per share for Tower last year in its takeover bid.
The bid trumped an earlier $1.17 offer by Fairfax (FXJ), which valued Tower at about $200m.
But the New Zealand Commerce Commission blocked Vero’s attempts to buy Tower.
The total loss on investment for Suncorp is $6.9m (NZ$7.5m).
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