RSA Insurance considering rights issue

RSA Insurance Group

Last Updated at 11 Jul 2014, 11:30 ET *Chart shows local time RSA Insurance Group intraday chart
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Insurance group RSA has confirmed it is considering raising money through a rights issue to bolster its finances.

A report in the Sunday Times said the company was set to launch a rights issue to raise £800m.

Last year, RSA uncovered a £200m hole in its finances at its Irish business, and the insurer could be facing a hefty bill from the recent floods in the UK.

Earlier this month, former Royal Bank of Scotland boss Stephen Hester took over as RSA's chief executive.

He replaced Simon Lee, who quit RSA in December after the problems in the Irish business were uncovered and following a series of profit warnings.

RSA, which owns the More Than brand, was forced to sack several executives at its Irish division after it found that misreporting of financial information had led to a £200m shortfall.

In a short statement, RSA said it was "considering measures to strengthen its balance sheet, including raising capital by way of a rights issue".

However, it added that no final decision had been made at this time.

RSA said it would give an update of its business review when it reported its full-year results on Thursday.

The Sunday Times said RSA was expected to announce plans to sell off some of its overseas businesses to raise cash.

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