Direct Line IPO, Hill Insurance

Royal Bank of Scotland has found buyers for the full 33% stake of insurer Direct Line it has put up for sale, within 3 days of the 9 day marketing period. It had set a price range of 160-195 pence last week. Direct Line would be worth £2.66bn at the mid-point of quoted price range.

Goldman Sachs and Morgan Stanely are running the offering, and are joint bookrunners together with UBS.

In another blow to Gibraltar insurance industry, Gibralatar-based Hill Insurance company is into liquidation.Court documents for the winding-up reveal the bonds it used as shareholders' equity were either non-existent or did not belong to the company.

This liquidation follows hot on the heels of Lemma insurance's liquidation last week.

Lemma Europe Insurance put into administration

The Gibraltar based insurance company Lemma Europe Insurance had been ordered by the Gibraltar regulator from making any claim payments. The insurer faces a winding-up order from the Financial Services Council (FSC), which will be heard in the Gibraltar Supreme Court and a liquidator will also be appointed.

It has been confirmed by a FSA spokesperson that UK policyholders with policies with Lemma are covered under the Financial Compensation Services Scheme.

It is worth mentioning that another Gibraltar based insurer Aldgate Insurance company has wound up in September 2009, leaving customers with outstanding claims.