Snowball ‘disappointed’ after RBS rejects insurance bid

Patrick Snowball has admitted that he was “disappointed” to have his bid for Royal Bank of Scotland Insurance (RBSI) turned down.

But the former Norwich Union chief executive said he “fully understood” the bank’s decision to keep the business.

The approach by his consortium was backed by private equity firms BC Partners and Apollo Management.

Snowball said his bid was not rejected on price and, at present, he was not involved in any other deals in the general insurance market. But he added that he could make a move if the right opportunity came along.

“It [RBSI] is a fantastic company and I would have liked to have been involved,” he said.

“I fully understand what the company has done and I’m pleased the uncertainty has been removed for Chris Sullivan [chief executive, RBSI] and his team.”

Last week, Royal Bank of Scotland announced that it was keeping its insurance division, which includes the Churchill and Direct Line brands.

Stephen Hester, the bank’s group chief executive, said a sale on the current available terms “would destroy value for RBS shareholders”. RBSI was a well run business that could play an important role within the group, he added.

A bank spokesman also ruled out the sale of broker-only insurer NIG.

The bank, which is 70% owned by the government, put the insurance business up for sale in April last year in an effort to raise capital. Insurers, including Allianz, Zurich, Generali and Warren Buffett’s Berkshire Hathaway, all pulled out of the race. Private equity firm CVC Partners and Swiss Re also failed with a late bid.