The Royal bank of Scotland, which is a state-controlled bank, has put its insurance business called Direct Line on sale. The division has been out for sale since the bank had taken public money in the financial crises. The sale was forced by the European Union as a punishment for the bank. Further, as per the reports, the deadline for the sale and the offloading of Direct Line has been set till the end of the year 2012 by the EU.
Also, in the earlier part of the year, the Chief Executive of RBS, Stephen Hester had said that though floating Direct Line was the ‘preferred option’; but in the wake of the disturbing performance of the division, a sale is the most probable option.
Now, that the reports of the sale are confirmed, one of the richest people on the planet, Mr. Warren Buffett is one of the potential bidders for Direct Line. It is believed that he is looking forward of buying out the division at a ‘knock-down’ price.
In the previous week, a beauty parade was organized by the RBS for all the advisors who were eagerly looking forward for the sale. From all the parties that have expressed interest in the bidding process, the prominent bidders are Berkshire Hathaway, which is Buffett’s investment medium and US insurer Allstate.
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