Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Tower's Stiassny takes swipe at IAG’s Lumley acquisition

Tower chairman Stiassny takes swipe at IAG’s Lumley acquisition

By Paul McBeth

Feb. 5 (BusinessDesk) - Tower chairman Michael Stiassny took a swipe at Australian rival Insurance Australia Group’s bid to buy Wesfarmers’ trans-Tasman underwriting businesses, saying the market dominance creates “significant risk.”

IAG has sought clearance from Australasian antitrust regulators to buy the WFI and Lumley Insurance brands as well as a 10-year distribution agreement with Coles for A$1.85 billion, something Tower’s Stiassny says is of concern to the wider industry.

“We are pleased the Commerce Commission is taking a close look at the proposed IAG acquisition of Lumley, given the implications for New Zealand, the insurance industry and consumers,” he said in speech notes to today’s annual meeting published on the NZX. “We believe there is significant risk from one business controlling two-thirds of the personal lines market, if New Zealand was to suffer another event on the scale of Canterbury.”

IAG, which operates the State, NZI and Lantern brands, grabbed more of the New Zealand market in 2012 when it bought assets of AMI for $380 million after its local rival was forced to seek a financial lifeline from the government when the Canterbury earthquakes drained its reserves.

On the proposed Lumley acquisition, the Commerce Commission has said it will look at whether the tie-up will damp competition in personal and commercial insurance products in home and contents, car, boats, commercial property, liability and marine cargo. A decision is due on March 28.

Tower chief executive David Hancock today told shareholders in Auckland industry consolidation continues to be a long-term theme, and that the insurer “is prepared to participate in this trend where we can add value for shareholders.”

The insurer has scaled back its operations to largely general insurance having sold the bulk of its life business to Fidelity Assurance and its investment arm to Fisher Funds. Tower looked at the AMI business on the block in 2011, and made a hostile takeover bid for Fidelity in 2010.

Shareholders approved today’s resolutions, which included amending the company’s constitution to trim the size of its board.

The shares were unchanged at $1.75 today.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Insurers Up For More Payouts: Chch Property Investor Wins Policy Appeal In Supreme Court

Ridgecrest NZ, a property investor, has won an appeal in the Supreme Court over insurance cover provided by IAG New Zealand for a Christchurch building damaged in four successive earthquakes. More>>

ALSO:

Other Cases:

Royal Society: Review Finds Community Water Fluoridation Safe And Effective

A review of the scientific evidence for and against the efficacy and safety of fluoridation of public water supplies has found that the levels of fluoridation used in New Zealand create no health risks and provide protection against tooth decay. More>>

ALSO:

Scoop Business: Croxley Calls Time On NZ Production In Face Of Cheap Imports

Croxley Stationery, whose stationery brands include Olympic, Warwick and Collins, plans to cease manufacturing in New Zealand because it has struggled to compete with lower-cost imports in a market where the printed word is giving way to electronic communications. More>>

ALSO:

Prefu Roundup: Forecasts Revised, Surplus Intact

The National government heads into the election with its Budget surplus target broadly intact, delivering a set of economic and fiscal forecasts marginally revised from May to reflect weaker commodity prices and a lower tax take. More>>

ALSO:

Convention Centre: Major New SkyCity Hotel And Laneway For Auckland

Today SKYCITY Entertainment Group Limited revealed plans to build a new hotel and pedestrian laneway of bars, restaurants and boutique shopping on land it owns in the Nelson and Hobson Streets block, expanding the SKYCITY Entertainment Precinct. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news