NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION

THIS IS AN ANNOUNCEMENT FALLING UNDER RULE 2.4 OF THE CITY CODE ON TAKEOVERS AND MERGERS (THE "CODE") AND DOES NOT CONSTITUTE AN ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CODE AND THERE CAN BE NO CERTAINTY THAT ANY FIRM OFFER WILL BE MADE

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

28 February 2024

Direct Line Insurance Group plc ("Direct Line Group" or the "Company")

Response to Statement by Ageas SA/NV ("Ageas")

The Board of Direct Line Group (the "Board") notes the recent announcement made by Ageas regarding a possible offer for the Company.

The Board confirms that on 19 January 2024 it received a highly conditional, non-binding indicative proposal from Ageas to acquire the entire issued and to be issued share capital of Direct Line Group (the "Proposal").

The terms of the Proposal comprised 100 pence in cash and one new Ageas share for every 25.24047 Direct Line Group shares. As at closing on 27 February 2024, the Proposal implies a value of 233 pence per Direct Line Group share.

The Board considered the Proposal with its advisers and considered it to be uncertain, unattractive, and that it significantly undervalued Direct Line Group and its future prospects while also being highly opportunistic in nature. Accordingly, the Board unanimously rejected the Proposal on 29 January 2024.

The Board is confident in Direct Line Group's standalone prospects given its strong strategic position, powerful brands, and robust capital position. Adam Winslow will take up the role as CEO on 1 March. He is tasked with refreshing the strategy and operational focus of the Group with the clear objective of returning to a sustainable level of operating profit over time.

Direct Line Group shareholders are advised to take no action in relation to the possible offer. A further announcement will be made as and when appropriate.

There can be no certainty that any firm offer will be made.

In accordance with Rule 2.6(a) of the Code, Ageas is required, by not later than 5.00 p.m. on 27 March 2024, either to announce a firm intention to make an offer for the Company in accordance with Rule 2.7 of the Code or announce that it does not intend to make an offer for the Company, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This deadline can be extended with the consent of the Panel on Takeovers and Mergers in accordance with Rule 2.6(c) of the Code.

The person responsible for arranging the release of this announcement on behalf of the Company is Neil Manser, Chief Financial Officer.

For the purposes of Rule 2.5(a) of the Code, this announcement is not being made with the approval of Ageas.

For further information, please contact:

Direct Line Group

Paul Smith

Director of Business Performance and Investor Relations

Email: paul.r.smith@directlinegroup.co.uk

Tel: +44 (0)7795 811263

Alan Oliver

Group Communications

Email: alan.oliver@directlinegroup.co.uk

Tel: +44 (0)7385 481295

Brunswick

Tom Burns / Nick Cosgrove / Diana Vaughton

+44 (0)20 7404 5959

Goldman Sachs International

Mark Sorrell / Charlie Lytle / Ashish Pokharna  

+44 (0)20 7774 1000

Morgan Stanley

Ben Grindley / Laurence Hopkins / Melissa Godoy

+44 (0)20 7425 8000

RBC Capital Markets                                                                            

Oliver Hearsey / Elliot Thomas / Ezzedine Ben Frej

+44 (0)20 7653 4000

Further information

This announcement is not intended to and does not constitute an offer to buy or the solicitation of an offer to subscribe for or sell or an invitation to purchase or subscribe for any securities or the solicitation of any vote in any jurisdiction. The release, publication or distribution of this announcement in whole or in part, directly or indirectly, in, into or from certain jurisdictions may be restricted by law and therefore persons in such jurisdictions should inform themselves about and observe such restrictions.

Goldman Sachs International, ("Goldman Sachs") which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority in the United Kingdom, is acting exclusively for Direct Line Group and no one else in connection with the matters referred to in this announcement and will not be responsible to anyone other than Direct Line Group for providing the protections afforded to clients of Goldman Sachs International, or for providing advice in relation to the matters referred to in this announcement.

Morgan Stanley & Co. International plc ("Morgan Stanley"), which is authorised by the Prudential Regulation Authority ("PRA") and regulated by the PRA and the Financial Conduct Authority ("FCA") in the United Kingdom, is acting exclusively for Direct Line Group and for no one else in connection with the possible offer and neither Morgan Stanley nor any of its affiliates, nor their respective directors, officers, employees or agents will be responsible to anyone other than Direct Line Group for providing the protections afforded to its clients or for providing advice in relation to the possible offer, the contents of this announcement or any other matters referred to in this announcement.

RBC Europe Limited, which is authorised by the Prudential Regulation Authority ("PRA") and regulated by the PRA and the Financial Conduct Authority ("FCA") in the United Kingdom, is acting exclusively for Direct Line Insurance Group plc and for no one else in connection with the possible offer and neither RBC Europe Limited nor any of its affiliates, nor their respective directors, officers, employees or agents will be responsible to anyone other than Direct Line Insurance Group plc for providing the protections afforded to its clients or for providing advice in relation to the possible offer, the contents of this announcement or any other matters referred to in this announcement.

Dealing Disclosure Requirements

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10^th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10^th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s), save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeror company and by any offeree and Dealing Disclosures must also be made by the offeror company, by any offeree and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeror and offeree companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeree was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Rule 2.9 information

In accordance with Rule 2.9 of the Code, Direct Line Group confirms that as at the latest close of business its issued share capital consisted of 1,311,388,157 ordinary shares of 10 10/11 pence each in issue and admitted to trading on the Main Market of the London Stock Exchange. Each ordinary share carries the right to one vote. The Company does not hold any ordinary shares in treasury. The International Securities Identification Number for Direct Line Group's ordinary shares is GB00BY9D0Y18.

Publication on website and hard copies

A copy of this announcement and the documents required to be published by Rule 26 of the Code will be made available, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, on the Company's website at directlinegroup.co.uk by no later than 12 noon (London time) on the business day following the date of this announcement. For the avoidance of doubt, the contents of those websites are not incorporated into and do not form part of this announcement.