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Paris insurance bust-up ends in humbling defeat

2 minute read

A woman waves a French flag from a window to support healthcare workers amid the coronavirus disease (COVID-19) outbreak in Saint-Mande, near Paris, France May 5 2020.

LONDON, June 11 (Reuters Breakingviews) - Napoleon relied on speedy battlefield movement to win his wars. Scor (SCOR.PA) boss Denis Kessler’s offensive against ex-bidder Covea has delivered a similarly crushing result. Shares in the $6 billion Paris-listed insurer rose 6% on Friday after it declared total victory over its one-time foe and largest shareholder. As part of the surrender, the mutual insurer run by Thierry Derez will grant Scor the right to buy its 8% stake at 28 euros per share, a measly 1% premium. Covea also agreed not to buy any new Scor shares for 7 years, back all draft resolutions submitted by the board, and take a chunk of Scor’s Irish life insurance business for $1 billion.

Part of the reason for the climbdown may be Derez’s appeal against a judgement last November accusing him of conflict of interest when Covea made an unsolicited 8.2 billion euro takeover offer in 2018. Scor has now dropped legal action. Although vindicating Kessler, Scor’s underperforming shares remain roughly a third below Covea’s offer price. With a potential bidder having to walk away, the victory could yet prove pyrrhic for shareholders. (By Christopher Thompson)

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