RSA, the owner of the More Than insurance brand, is in talks with two overseas insurers over a £7bn deal which could result in the takeover and break-up of one of the FTSE 100’s oldest companies. The London-headquartered insurer confirmed it had received an offer after its shares surged by 46% on Thursday following media reports of a possible deal. The two possible buyers are Canadian insurer Intact Financial Corpor and Danish insurer Tryg. Under the terms of the offer they would pay £6.9bn for RSA’s shares, while investors would also receive an already announced £83m dividend. The approach was first made on 2 October. In a statement to the stock market after trading closed on Thursday, RSA said “it would be minded to recommend the proposal” to shareholders. If successful, Tryg would take over RSA’s Sweden and Norway business, while Intact would take over RSA’s UK, Canadian and other international operations. Both companies would co-own RSA’s Denmark business. RSA was formed in 1996 through the merger of Sun Alliance with Royal Insurance. The original Sun Insurance company was founded in 1706, and its successors have provided home insurance to the likes of Captain James Cook, the explorer, and Charles Darwin, the evolutionary theorist. The company still offers personal and commercial insurance products, as well as underwriting of home insurance for brands such as John Lewis and pet insurance for Argos and Tesco. The deal would represent a 49% premium to the share price on Thursday morning before the market opened. Shares rocketed from 423.6p to 670p after the deal was first reported by Bloomberg. The proposed valuation is the highest RSA has achieved since the summer of 2018. The insurer’s market value had fallen significantly during the coronavirus pandemic. However, in a trading update published on Thursday morning, before the deal was revealed, RSA said that operating profits for the first nine months of 2020 had increased compared with the previous year, and insurance premium income fell only 3% year-on-year to £4.6bn. That came despite a court ruling that could require the RSA and other insurers to pay out to small business clients who were wrongly denied payouts under business interruption insurance policies when pandemic restrictions forced them to close. The insurers are appealing the ruling. RSA’s chief executive, Stephen Hester, said: “While Covid-19 has held back our profit overall, RSA’s inherent strength and the improvements we have made are driving the business forward in a pleasing manner. The outlook for continued underwriting improvements remains positive.” Under takeover law the possible buyers have until 5pm on 3 December to either make an offer or withdraw.