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Zurich must decide by 5pm Tuesday to bid or walk
BUY for TARGET 513 The trend of RSA INSURANCE GROUP PLC shows buying side. Resistance level of 508 with the stop loss of 503. Stock is trading in a range and trading near the trend-line. Breaking the resistance line will lead to upside movement. Stock is trading above the 50 DMA with positive bias. RSI is trading near to 60.26 level with positive bias, in upcoming session upside movement is expected. MACD and Signal line is sustaining above the zero level line. Skype tayal.smith1
Zurich have until 25th to make a formal offer. I suggest that you wait until next Monday to judge the mood, or insider info, that will reflect on the sp. The only problem is whether the sp starts to rise dramatically, it may be just a ploy to pull you in before it crashes back on a no offer, or offer rejected.
Yes, but the current price reflects a discount for uncertainty. If an offer does not materialise then the price is likely to fall sharply, so buying now carries a risk. It is a guess as to whether an offer will be made and if so at what level (although one would expect higher than today's price!) and whether there will be a counter bid from another prospective buyer to push the price up. So, it's a good old fashioned punt to decide which way to jump, based on an assessment of the upside versus the downside risk.
Isn't this still worth buying if a bid comes in around 530-550?
You were probably placed better than my situation with Verizon. I have a very agreeable arrangement with HMRC and did not wish to involve US tax system, or any other tax system for that matter, plus having 50% cut in shares if taking the offer. Also there has been no appreciable rise in Voda sp since selling and I would have only got half the divi , due to only having half the shares . It's fair to say that I could have chosen a better place than RSA and would have been less stressful staying with Voda. If I can break even here I hope to find a better home or put the money in ING for a fab 3% return. Not attractive, but better than a loss. Anyway, it has been nice to have some one else's story and perspective. Thanks for your input... ATB
Mepobre I too made a good profit on VOD having held long before the deal was announced. However, I knew exactly what the verizon disposal entailed (ie. no "windfall") so did not find it confusing at all. I kept the Vod and still hold the VZC and put the cash back into VOD. The upshot is that my holding is still looking strong and producing a good dividend plus the VZC sit there at much the same value as when given to me but also give a 4% dividend yield. My problem was that at the time I could not think of another home for the cash I would have got from selling Vod so stayed in. Bad luck to choose RSA as the home for yours, but I can understand the reason for your decision at the time.
I have a similar story, I joined after making a profit on Voda, but left them because of the smoke and mirrors offer. Looking for divi return I bought RSA @ £1.21..... 6 weeks later the whole thing crashed and divi was scrapped. Since then I have had to sell 30,000 @ approx. 20p loss per share, ie 6K down. I took up the offer of a sort of buy 1 get one free, so ended up paying 56p for 3,750 shares. I sold 750 at a compound profit of £1 a few months back and sold 3,000 last week at approx. £ 2 profit Therefore I have more or less broken even on the 56p allocation. I now need the offer price to reach £6.05 to break even on the original full price consolidated shares. A lot of waiting and messing about to get back to where I started, with very little in the way of divi's, which was the point of the whole exercise. Bloody waste of time really, but I will be glad just to get out without the crippling loss thus far.
QE. I got into RSA as a result of using the top yields table which placed them at (or near) the top of best dividend paying FTSE100 stocks. I thought they were a boring insurance company which would be a steady source of dividend income and duly reinvested all such dividends into new shares. Over 2 years or so I had built up a nice position only for it all to come crashing down around me. I was very lucky to exit with a small profit in the end. Looking at the speculation on here regarding a +600p take out by Zurich I am still happy I sold as I reinvested in other stocks which have performed well. So rather than the frustration of watching RSA go nowhere fast over the past year or so at least I have felt my money was working for me and also more diversified across different sectors. I may be no better off if the Zurich deal goes though, but I am more content. Same goes for RBS which I exited at a loss in early 2013 after buying it as a recovery play. The RBS cash went into AZN and NG. and both have done very well for me.
http://www.cityam.com/221494/rsa-hoping-better-offer-bidders-circle
http://www.*****************/rsa-hoping-for-better-offer-as-bidders-circle/
Insurer RSA ready to hold out for 600p-a-share bid from Zurich: The board of the FTSE 100 insurance giant RSA are understood to be pushing for a take-out price of at least 600p a share from potential bidders Zurich
So many stocks over the years come with many rumours which you just follow and sit tight... I bought The Times on Thursday and mentioned that Zurich would only offer cash if the deal were accepted. Possibly because they wouldn't want to go down similar route as Verizon did with Vodafone and list the stock on LSE so they could offer part stock and part cash. This must be my 13th m&a deal I remember being part of in my 17yrs with my stocks and shares. Boots - went private with KKR Scottish Power - Iberdrola Carlsberg - forgotten who bought them from me Xstrata - Glencore Safeways - WMorrisons Cadburys - Kraft Arriva - Deutsche Bahnhoff SSL - Reckitt Alliance&Leicester - Santander Rexam - BALL pending Can't remember the other few iv been lucky with ... ATB I hold 1750 RSA at 525p; old money 142p.
If the deal were to go ahead then they would buy your shares from you, but until any formal announcement is made you would not know whether it would be all cash, all Zurich shares or a mixture of the two. As sam says this is only at the early stages yet, if you sell now you may miss out on an extra 30p in a few months or, the deal could not go ahead, the sp could drop back and you may miss out on today's sp. It really depends on what you wanted to achieve with your holding before this potential deal was announced, whether you need the cash now, and what you will do with the cash if you do sell - Decisions, Decisions. ATB.
This risks of holding are that no formal offer is made from either Zurich or any other player within 4 weeks and that the offer made is lower than the current share price. Personally I am holding, gambling the opposite is true with around 70% certainty :) lol Your attitude to risk should determine whether you take the money and run right now or wait it out. As for what will happen if there is a takeover then it is my understanding terms of takeover will be revealed and that you may elect to take cash, stock (in zurich) or maybe both but that won't be confirmed until later. I could be wrong though so take this as very informal advice.
Sorry, 520p*
Hi all, apologies for what may be a stupid question. I have around 2000 shares in RSA through previous employment. If the Zurich takeover happens, would/could I get 550p per share from them? Do they effectively buy my shares off me? As I'm thinking of selling now at 120p? I'm a complete newbie, so apologies again.
Hello again Grayling - my only motive in popping on to this bb yesterday was to wish a holder well though this share has offered good trading opportunity over the last day or so. I saw the sun this morning and was going out for the day but it quickly disappeared and instead I am indoors watching a few shares while working. I doubt whether it is worth you and I going into our pasts here as it was so long ago lol and there are so few posts on this bb that my history will still be here for all to see. What might be of interest though is that we have been talking about scrips, crips and drips divis elsewhere. Oddly enough, I first bought into this share at a time when I was reading somebody on another bb talking about them in relation to rsa and how great they were. No sooner had I bought in than the divi was axed and the poster stopped talking about rsa on the other bb lol. Bonz kind of guided us all through the rights issue and was not at all cross with me when I sold for a small profit the morning the rights shares hit my account and I think I was lucky that my brokers had been quite quick to credit the rights shares to my account in the morning because there were groans from others in the afternoon if I remember rightly.. You are right some shares need light trading, some need heavy trading and some little or none to eke a profit depending on when the individual first invested. The skill for the individual is in deciding when to do what and when to do nothing. I think the trouble is that sometimes people don't say what on earth they are doing with a share and that often gives a false impression to others. I'm on the verge of selling a share I have held for a while. Will I get flak on the bb if I say that. Might just slip off quietly into the sunset like so many others do. Nice uplift though in the price here for the long suffering holders. atb.
Spot on with your last comment QE. You have to do a little light trading even in a long term portfolio and certainly keep an eye out for any event which threatens the dividend and get out quick. I had been in RSA for a couple of years when the Ireland fiasco hit and got out straight away making a meagre 3.1% profit. However switching the money into FLG (now Aviva) and Phoenix has served me well with both shares doing OK and paying dividends in the meantime. Far better than leaving the cash in RSA and taking the rights issue. Even if Zurich take it out at 550p cash I am still better off.
Sorry to hear that but I suppose shares move up and down and you are usually canny elsewhere and buy at a keen price so if its only two or three where you've bought high and scraped breakeven rather than made lots then that's not bad going and better than a loss. I suppose I have cottoned on to the fact that long-term investing in a share for some means doing a little light trading of it as well when warranted. atb.
Jeezuz They are only considering this at the moment
Esure.....IMO
Grayling has it spot on a few posts back, maybe a little profit on the RI but nothing for long term holders. This was over £6 back in '99, which with the 5:1 consolidation would be over £30 today - so speculation around £5 a share means nothing. If it is taken over at this level I will make as much as I did out of THT - **** all - but at least it won't be a loss!! ATB.
Still got the rights ones no doubt.