A Finnish/South African consortium has bought Hastings Group in a deal valuing the UK insurer at £1.7bn.

The consortium is called Dorset Bidco and comprises Sampo and Rand Merchant Investment Holdings. Prior to the deal being struck, Sampo and RMI owned a combined stake of 29.7% in Hastings.

Sampo is a Nordic insurance group listed on Nasdaq Helsinki with a market capitalisation of approximately £15.9bn.

RMI is a South African financial services investment holding company with its shares listed on the Johannesburg Stock Exchange. It has a market capitalisation of approximately £2.1bn.

News of the acquisition, which is subject to shareholder and regulatory approval, broke as Hastings announced its H1 results for the six months ended 30 June 2020.

It reported a 3% increase in gross written premiums up to £514.9m, compared to the same period last year.

Profit after tax for the period was £54.8m -- up from £38.2m the previous year.

Commenting on the results, Toby van der Meer, chief executive officer at Hastings, said: “The group's strong customer retention rates and some improvement in new business competitiveness has contributed to a 4% increase in live customer policies in the six months to 30th June 2020, and a 5% year on year growth from 30th June 2019. The market share of UK private car insurance increased to 8.1%, from 7.7% at 31 December 2019.”

He added: “Hastings has increased gross written premiums by 3% via an increase in live customer policies offset by a reduction in average premiums, primarily due to a change in the risk mix of policies written and some targeted premium reductions provided to customers in the second quarter to reflect lower claims frequencies.”

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