However, Protector Forsikring said that it is not gearing up for a possible takeover of FBD and that it took the stake solely for investment purposes, according to a report by the Irish Independent.
“The investment is not strategic and is taken by the investment department in Protector,” the company’s chief investment officer Dag Marius Nereng was quoted as saying in the report.
“An entrance to the Irish market is not on the agenda.”
According to Nereng, his firm paid around €7.20 per share in FBD, and Protector was “happy” to acquire a substantial stake in the Irish company and confident in its long term prospects.
Protector has assets under management of €1.5 billion, with its stake in FBD equivalent to around 1% if that value.
Nereng said that Protector is constantly assessing its investments and did not exclude the possibility of expanding its stake in FBD.
Protector recently revealed to investors plans to expand into new markets, with Ireland a close neighbour of its existing market in the UK.
FBD suffered a blow to its business after it got caught in a conflict with policyholders over whether to pay business interruption claims due to the COVID-19 pandemic. In February, the Commercial Court sided with the customers and ruled that FBD had wrongly denied the claims.
The ruling would cost FBD €65 million, more than twice its initial estimate of €30 million last year.