Insurance Australia Group (IAG) Share Purchase Plan

IAG is conducting a retail share purchase plan (SPP) from which it aims to raise a maximum of A$200 million to help fund the purchase of Wesfarmer’s insurance underwriting business in Australia and New Zealand. Eligible shareholders are able to purchase ordinary shares without incurring any brokerage or transaction costs.

In terms of the SPP, shares can be bought at the lesser of:

  • the price institutional investors paid in the institutional placement, which was A$5.47 per Share (which equates to a 6% discount to the market price at the time of writing);
  • or a 2% discount to the five day volume weighted average price of IAG ordinary shares traded on the ASX up to and including the closing date of the SPP (24 January 2014).

Given the discount currently available we intend participating in the SPP on behalf of eligible clients. Unfortunately the SPP is subject to scale back at IAG’s discretion and thus it is not possible to determine the number of shares that will ultimately be allocated to successful applicants.

To help fund the purchase of additional IAG shares under the SPP we have today sold the non-core holdings in Orora Limited (demerged from Amcor) and Recall Holdings Limited (demerged from Brambles).

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