Five bidders remain as share price hits eight year low.
Chinese insurer Ping An pulled out of the bidding for Royal Bank of Scotland's insurance business yesterday, one day after Italian insurer Generali dropped out.
Reports said as a result, RBS fell to the lowest in eight years of London trading, dropping 2.6% to 231.75p. Bloomberg said the drop values Britain's second largest bank at £37.4bn. It added that the stock has lost 39% this year and now trades 16% above the 200p strike price for the company's £12bn rights offer.
With the share price dangerously nearing the £2 level, the rights issue has been called into question and reports said it may need to be revamped.
Zurich, Allstate, Travelers, American International Group and Allianz are the remaining possible buyers. Berkshire Hathaway ruled itself out of the bidding two weeks ago.
Yesterday RBS extended the Wednesday deadline for the auction. It has been speculated that the extension was granted because the bank had not received high enough value offers for its Churchill and Direct brands, which are estimated to be worth between £5bn and £7bn. Later it emerged that prospective buyers of the business had requested more time to evaluate their bids.
