ZURICH/FRANKFURT, Jan 11 (Reuters) - Shares in insurer Swiss Life extended gains from the end of last week as rumours continued that German rival Allianz was preparing a takeover, though analysts were sceptical that a bid was feasible.
French website Wansquare reported on Sunday that Allianz was preparing a bid, citing various unnamed Swiss banking sources.
This added to similar market speculation last week that had driven the stock to a 2010 year-to-date gain of 9.6 percent by the close of trade on Friday.
Swiss Life and Allianz have declined comment.
'That Allianz Swiss group life business is suboptimal is well known, and an acquisition could therefore basically make strategic sense. Swiss Life is however not the right target for Allianz,' said Kepler Capital markets analyst Fabrizio Croce.
'An enticing offer to shareholders is also improbable as it would need to be astronomical,' he said.
Swiss Life shares gained 7 percent to 154.80 Swiss francs by 0904 GMT, against 0.4 percent rise in the Dow Jones Stoxx European insurance index. Allianz was up 0.4 percent.
Swiss Life trades at about 10.4 times estimated 12-month forward earnings, a slight premium to Allianz's multiple of 8.3, according to Thomson Reuters StarMine, which weights analyst estimates according to their track record.
JP Morgan analyst Michael Huttner said Allianz was probably not interested in Swiss Life's core business of group pensions in Switzerland and also did not need to buy access to Swiss Life's pensions broker AWD, through which Allianz already sells.
A takeover might also raise cartel questions in Germany and would also weigh on Allianz's regulatory solvency capital, Huttner said.
'None of the arguments are compelling for doing a deal. There are lots of little negatives but nothing that's a big positive,' Huttner said.
Allianz Chief Financial Officer Oliver Baete said in November that the company planned no acquisitions and no capital hike.
Swiss Life said giant asset manager Blackrock had 3.71 percent in the company as of Jan.9. Reuters data show Blackrock had 4.2 pct of Swiss Life on Dec.8.
(Reporting by Jason Rhodes in Zurich and Jonathan Gould in Frankfurt) (Zurich Newsroom, zurich.newsroom@reuters.com, +41 58 306 7336) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
French website Wansquare reported on Sunday that Allianz was preparing a bid, citing various unnamed Swiss banking sources.
This added to similar market speculation last week that had driven the stock to a 2010 year-to-date gain of 9.6 percent by the close of trade on Friday.
Swiss Life and Allianz have declined comment.
'That Allianz Swiss group life business is suboptimal is well known, and an acquisition could therefore basically make strategic sense. Swiss Life is however not the right target for Allianz,' said Kepler Capital markets analyst Fabrizio Croce.
'An enticing offer to shareholders is also improbable as it would need to be astronomical,' he said.
Swiss Life shares gained 7 percent to 154.80 Swiss francs by 0904 GMT, against 0.4 percent rise in the Dow Jones Stoxx European insurance index. Allianz was up 0.4 percent.
Swiss Life trades at about 10.4 times estimated 12-month forward earnings, a slight premium to Allianz's multiple of 8.3, according to Thomson Reuters StarMine, which weights analyst estimates according to their track record.
JP Morgan analyst Michael Huttner said Allianz was probably not interested in Swiss Life's core business of group pensions in Switzerland and also did not need to buy access to Swiss Life's pensions broker AWD, through which Allianz already sells.
A takeover might also raise cartel questions in Germany and would also weigh on Allianz's regulatory solvency capital, Huttner said.
'None of the arguments are compelling for doing a deal. There are lots of little negatives but nothing that's a big positive,' Huttner said.
Allianz Chief Financial Officer Oliver Baete said in November that the company planned no acquisitions and no capital hike.
Swiss Life said giant asset manager Blackrock had 3.71 percent in the company as of Jan.9. Reuters data show Blackrock had 4.2 pct of Swiss Life on Dec.8.
(Reporting by Jason Rhodes in Zurich and Jonathan Gould in Frankfurt) (Zurich Newsroom, zurich.newsroom@reuters.com, +41 58 306 7336) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
