DIRECT LINE PUTS PRICE RANGE AT 160P TO 195P PER SHARE

UK-based insurance Group Direct Line has set a price range of 160p to 195p a share for its planned flotation later this month. The all-secondary share offering of stock owned by RBS Group will consist of between 375m and 500m shares, representing a stake of between 25% and 33%. There will be an over-allotment option of up to 15%. The mid-point of the offer price would value Direct Line at £2.633bn ($4.249bn). The announcement of the final pricing is expected on October 11, with conditional dealing in the shares beginning the same day. Direct Line and RBS have agreed to a 180-day lock-up following admission to trading of the newly floated stock. The Directors have agreed to a 360-day lock-up period. Meanwhile, Direct Line Group said that trading in H2 to date had been in line with the trends experienced in H1. On regulatory reforms Direct Line Group said that it believed that the civil litigation costs reforms scheduled to come into operation on April 1 2013 would have a "broadly neutral effect on the results of the Group in the medium term". The group has signed a five-year deal with RBS for an "arm's length, five-year distribution agreement for the continued provision of general insurance products post-divestment".