RSA shares dive after Zurich ditches bid

Zurich Insurance abandoned its £5.6bn (€7.69bn) proposed bid for Britain’s RSA, after forecasting a $200m (€178m) third-quarter loss yesterday largely due to explosions at Chinese port Tianjin.

A day before a bid deadline under British takeover rules, Zurich said it would conduct a review to improve the performance of its general insurance business, instead of taking over its London-listed rival, sending RSA shares down by as much 23% at one stage.

RSA, which is pursuing a turnaround strategy under former Royal Bank of Scotland boss Stephen Hester, said Zurich had found nothing untoward in its “due diligence” checks on its books that would have thwarted a deal on the 550p per share terms proposed on August 25.