(Updates with analyst comment, closing shares prices.)
AMSTERDAM, Oct 20 (Reuters) - Shares of Dutch insurer ASR spiked in afternoon trading on Friday after Bloomberg reported that Aegon had approached the company for a possible takeover but was rebuffed.
The report cited people familiar with the matter, and ASR shares initially rose as much as 9 percent, then faded, eventually closing 2.5 percent higher at 34.86 euros.
Aegon closed 0.5 percent lower at 4.98 euros.
ASR spokeswoman Anita Wassink said the company could not comment on rumours.
“We believe that ASR is strong enough for a standalone position in the Dutch insurance market,” she said.
Aegon spokesman Dick Schiethart said “we have no idea where this is coming from.”
He added the company has not said it is pursuing acquisitions.
Dutch regulators have generally welcomed consolidation on the domestic insurance market after several life insurers were found to be weakly capitalised in the run-up to the introduction of Europe’s new Solvency II regime.
The country’s largest insurer, NN Group, agreed to buy the troubled Delta Lloyd in December 2016.
Analyst Ashik Musaddi of JPMorgan said the idea had merit, given potential cost savings from combining the businesses, but it was difficult to see how it would benefit Aegon.
“Given lack of excess capital at Aegon we believe (it would) not be value accretive overall from Aegon’s perspective,” he said in a note.
Aegon, which does two-thirds of its business in the United States, has been selling assets to shore up its solvency in the Netherlands. As recently as August, it sold Unirobe Meeus Groep (UMG), a Dutch financial advisory group, to Aon Groep Nederland for 295 million euros.
ASR, meanwhile, had a stronger capital position heading into Solvency II and has itself been an acquirer, buying Generali Nederland for 143 million euros ($171 million) in September. (Reporting by Toby Sterling, editing by David Evans)