Investment Column: Norwich dangles a sizeable carrot
Wednesday 04 June 1997
It is certainly an attractive deal, although because Norwich is choosing to raise fresh capital at the same time as its conversion to a publicly quoted company, institutions will not be quite so desperate as with Halifax and Alliance & Leicester to buy a meaningful weighting in the stock. That means the silly ratings applied to the building societies are unlikely to be repeated.
That said, Norwich Union is a well-regarded company, operating in a market that is bound to grow fast thanks to the steady unravelling of the welfare state. Its management has an improving reputation and there is still plenty of scope to cut costs. Most of the benefit of that process will now accrue to shareholders. Sales and profits from the UK life business are improving substantially, while the smaller general insurance arm has refocused on personal and small commercial lines and away from long tail policies and large risks. There is a strong healthcare business.
The dividend is well covered by life profits, so a gross yield at the flotation price of near to 5 per cent is both safe and attractive against the rest of the market. With a current "grey market" price of 305p, members should take up more shares, while the equity also looks reasonable value for outside investors.
- 1 Christmas comes early to Hong Kong, as millions of bank notes spill out onto busy street
- 2 The 'Black Museum': After 150 years, public can visit police’s grisly crime museum
- 4 Vagina canoe artist facing two years in jail defends herself over ‘obscenity’ charges
- 5 The Queen’s speech 2014: Recap and Twitter reaction to Game of Thrones reference
PlayStation and Xbox hacked by Lizard Squad
Antonio Martin shooting: Black teenager may have tried to ambush patrolman, says police officer's lawyer
Katie Hopkins speaks out on childhood obesity: 'Parents of fat children should be prosecuted for child cruelty'
Boxing Day snowfall could push even more bargain-hunters online for Christmas sales
The 'Black Museum': After 150 years, public can visit police’s grisly crime museum
British actor Idris Elba cannot star as James Bond because he is black, says shock jock Rush Limbaugh
Rozanne Duncan: Ukip expels councillor for 'jaw-dropping' comments made in BBC TV interview
Germany anti-Islam protests: 17,000 march on Dresden against 'Islamification of the West'
Ukip member gets into Christmas spirit with Union Flag plea to Santa 'for our country back'
BBC director Danny Cohen: Rising UK antisemitism makes me feel more uncomfortable than ever
Alex Salmond has 'broken his word to the Scottish people' says Scottish Lib Dem leader
iJobs Money & Business
Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...
£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...
£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...
£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...