US-EU Index & Corporate Actions Analyst, ORTEX

Harry Kalfas

US-EU Index & Corporate Actions Analyst

Global Financial Data and Analytics Platform

ORTEX

ORTEX is a global financial data and analytics platform providing real-time securities lending and short interest data, index rebalance data, holdings and insider transactions, trading signals, corporate actions and news,  stock machine learning and factor scores and other analytics. The majority of the data are downloadable and accessible through APIs.

Index Rebalance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/aviva-plc" target="_blank" data-smartkarma-citation="entities:21822:1" rel="noopener">Aviva's (AV/ LN)</a> £3.7B acquisition of <a href="https://www.smartkarma.com/entities/direct-line-insurance-group-pl" target="_blank" data-smartkarma-citation="entities:21902:1" rel="noopener">Direct Line Insurance Group Pl (DLG LN)</a> combines two major insurers, with £125M in expected annual synergies by year three.</li>
<li>
<a href="https://www.smartkarma.com/entities/direct-line-insurance-group-pl" target="_blank" data-smartkarma-citation="entities:21902:1" rel="noopener">Direct Line Insurance Group Pl (DLG LN)</a> shareholders to receive 0.2867 new <a href="https://www.smartkarma.com/entities/aviva-plc" target="_blank" data-smartkarma-citation="entities:21822:1" rel="noopener">Aviva (AV/ LN)</a> shares, 129.7p in cash, and up to 5p in pre-completion dividends per share held.</li>
<li>The acquisition is expected to impact major UK and European indices on an intra-quarter basis.</li>
</ul>



Aviva's (AV/ LN) £3.7B acquisition of Direct Line Insurance Group Pl (DLG LN) combines two major insurers, with £125M in expected annual synergies by year three.

Direct Line Insurance Group Pl (DLG LN) shareholders to receive 0.2867 new Aviva (AV/ LN) shares, 129.7p in cash, and up to 5p in pre-completion dividends per share held.
The acquisition is expected to impact major UK and European indices on an intra-quarter basis.


Aviva’s £3.7B Acquisition: Key Index Changes

Managing Partner, VRS (Valuation & Research Specialists)

VRS (Valuation & Research Specialists)

Managing Partner

Valuation & Research Specialists (VRS) is a boutique financial advisor with more than 17 years of experience in Corporate Valuation and Finance, and a diversified client base including some of the largest Companies in Greece.

Since 2002, VRS has completed more than 200 engagements in the areas of business valuation and financial analysis for more than 100 clients in a wide range of industries.

VRS has been honored to work with small and large private and publicly traded companies in Europe and overseas.

Boutique Financial Advisor

Equity Bottom-Up

<ul>
<li>Aviva plc is a United Kingdom-based insurance, wealth, and retirement business company.</li>
<li>Its segments include UK &amp; Ireland Insurance, General Insurance, and Aviva Investors, International investments, and Other Operations.</li>
<li>
<p>Each fiscal year ending at December 31. | Year 2024: January to December 2024. | Year 2023: January to December 2023. | 6M 2024: January to June 2024</p>
</li>
</ul>


Aviva plc is a United Kingdom-based insurance, wealth, and retirement business company.
Its segments include UK &amp; Ireland Insurance, General Insurance, and Aviva Investors, International investments, and Other Operations.

Each fiscal year ending at December 31. | Year 2024: January to December 2024. | Year 2023: January to December 2023. | 6M 2024: January to June 2024



Aviva Plc - Company Update - July 17, 2024

Event-Driven Investment Opportunities, Special Situation Investments

Special Situation Investments

Event-Driven Investment Opportunities

Focus on event-driven trades and low risk arbitrage opportunities with short term catalysts

Event-Driven

Direct Line Insurance Group Pl / Event-Driven

<ul>
<li>Aviva is acquiring Direct Line for £1.297 cash, 0.2867 AV shares, and £0.05 dividend, totaling £2.70/share.</li>
<li>Direct Line's board is prepared to recommend the offer; Aviva is conducting due diligence with a PUSU date set for December 25.</li>
<li>The offer values Direct Line at 1.6x BV and 2.6x TBV, with potential regulatory scrutiny due to market share.</li>
</ul>


Aviva is acquiring Direct Line for £1.297 cash, 0.2867 AV shares, and £0.05 dividend, totaling £2.70/share.
Direct Line's board is prepared to recommend the offer; Aviva is conducting due diligence with a PUSU date set for December 25.
The offer values Direct Line at 1.6x BV and 2.6x TBV, with potential regulatory scrutiny due to market share.


Aviva's Acquisition of Direct Line: 9.5% Merger Arbitrage Opportunity Amid Regulatory Considerations and Shareholder Dynamics

European Event-Driven Analyst

Jesus Rodriguez Aguilar

<ul>
<li>Aviva’s sweetened 275p proposal for Direct Line, with a 73.3% premium, aims to strengthen its UK insurance market leadership and achieve £100M+ cost synergies, enhancing profitability and competitiveness.</li>
<li>The proposal values Direct Line at an 13.05x forward P/E multiple, higher than its five-year average of 9.95x. The acquisition is a transformative move for Aviva amidst ongoing sector consolidation.</li>
<li>PUSU deadline is 25 December. Gross spread is 8.8%. I believe Aviva will make a firm offer and would be long the spread. </li>
</ul>


Aviva’s sweetened 275p proposal for Direct Line, with a 73.3% premium, aims to strengthen its UK insurance market leadership and achieve £100M+ cost synergies, enhancing profitability and competitiveness.
The proposal values Direct Line at an 13.05x forward P/E multiple, higher than its five-year average of 9.95x. The acquisition is a transformative move for Aviva amidst ongoing sector consolidation.
PUSU deadline is 25 December. Gross spread is 8.8%. I believe Aviva will make a firm offer and would be long the spread. 


Aviva/Direct Line: Preliminary Offer Agreement

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>The lows have likely been established for this correction, but a bottoming process would likely take weeks or potentially months and could come with more tests of the lows.</li>
<li>Japan's TOPIX and Nikkei 225 are each testing their respective downtrends. The EURO STOXX 50 is testing resistance in the 4040-4090 range. Germany's DAX is testing major resistance at 14,815-14,950.</li>
<li>It is likely that this initial 2-3 week bounce has run its course; stick with cyclical value and defensives, areas we have been focused on for most of 2022.</li>
</ul>


The lows have likely been established for this correction, but a bottoming process would likely take weeks or potentially months and could come with more tests of the lows.
Japan's TOPIX and Nikkei 225 are each testing their respective downtrends. The EURO STOXX 50 is testing resistance in the 4040-4090 range. Germany's DAX is testing major resistance at 14,815-14,950.
It is likely that this initial 2-3 week bounce has run its course; stick with cyclical value and defensives, areas we have been focused on for most of 2022.


Sticking With Cyclical Value and Defensives; Adding Large-Cap Japan Technology

United Kingdom

Aviva PLC operates as an international insurance company that provides all classes of general and life assurance, including fire, motor, marine, aviation, and transport insurance. The Company also offers a variety of financial services, including unit trusts, stockbroking, long-term savings, and fund management.

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Aviva (AV/ LN)

Aviva’s £3.7B Acquisition: Key Index Changes

Aviva’s £3.7B acquisition of Direct Line will impact major UK and European indices, with Direct Line shareholders receiving cash and shares.

Harry Kalfas

Aviva Plc - Company Update - July 17, 2024

Aviva plc is a United Kingdom-based insurance, wealth, and retirement business company. Its segments include UK & Ireland Insurance, General...

VRS (Valuation & Research Specialists)

Aviva's Acquisition of Direct Line: 9.5% Merger Arbitrage Opportunity Amid Regulatory Considerations and Shareholder Dynamics

Aviva is acquiring Direct Line for £1.297 cash, 0.2867 AV shares, and £0.05 dividend, totaling £2.70/share.

Special Situation Investments

Aviva/Direct Line: Preliminary Offer Agreement

Aviva’s sweetened 275p proposal for Direct Line, with a 73.3% premium, aims to strengthen its UK insurance market leadership.

Jesus Rodriguez Aguilar

Sticking With Cyclical Value and Defensives; Adding Large-Cap Japan Technology

Sticking With Cyclical Value & Defensives; Adding Large-Cap Japan Technology. 2-3 week bounce has likely run its course with $TOPIX $Nikkei 225,...

Vermilion Research

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