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

 

Final Frontier: Rocket Lab And NASA Sign Commercial Space Launch Agreement

Rocket Lab has signed a Commercial Space Launch Act Agreement with the National Aeronautics and Space Administration (NASA). The agreement enables Rocket Lab to use NASA resources - including personnel, facilities and equipment - for launch and reentry efforts. More>>

ALSO:

Scoop Business: Wheeler Downplays Scope For ‘Large’ Rates Fall

Reserve Bank governor Graeme Wheeler says some market commentators are predicting further declines in interest rates that would only make sense for an economy in recession, although some easing is likely to be needed to maintain New Zealand’s economic growth. More>>

ALSO:

Ruataniwha Dam: Consent Conditions Could Mean Reduced Intensity

Legal advice sought by the Hawke’s Bay Regional Council on the Ruataniwha Dam consent conditions has confirmed that farmers who sign up to take water from the dam could be required to reduce the intensity of their farming operation to meet the catchment’s strict nitrogen limit. More>>

Health And Safety: Bill Now Sees Rules Relaxed For Small Businesses

Health and safety law reform sparked by the Pike River coalmine disaster has been reported back from the industrial relations select committee with weakened requirements on small businesses to appoint health and safety representatives and committees. More>>

ALSO:

Bearing Fruit: Annual Fruit Exports Hit $2 Billion For First Time

The value of fruit exported rose 20 percent (up $330 million) for the June 2015 year when compared with the year ended June 2014. Both higher prices and a greater quantity of exports (up 9.0 percent) contributed to the overall rise. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news