Good morning, everybody. My name is Gianandrea Roberti. I'm head of investor relations at Tryg. We published our prospectus this morning, launching our DKK 37 billion rights issue, and I have here with me Morten Hübbe, Group CEO, Barbara Plucnar Jensen, Group CFO, and Johan Kirstein Brammer, Group CCO. Morten, over to you.
Thank you, Gian. And after a hectic weekend, we're pleased to publish our prospectus this morning. And good afternoon to all of you from my side as well. We start off slide three, where we give an update on the RSA acquisition. Really happy to launch our rights issue today. And of course, after having received the shareholders' approval, and we're pleased that the timetable announced in November, we can confirm again today.
Following the rights issue, we expect closing of the transaction by H1 2021. If we move on to slide five, we give an overview of the composition of the financing. And as we disclosed in November, the acquisition will be financed through a rights issue of roughly DKK 37 billion and debt issuance of DKK 2 billion-DKK 2.5 billion.
Last week, we issued a Tier 1 instrument, a highly successful transaction of SEK 1 billion. Today, we launch our rights issue of DKK 37 billion, fully underwritten by Morgan Stanley and Danske Bank as joint global coordinators, and with Citi, HSBC, and Nordea as joint lead managers. The total of DKK 39 billion, be that the rights issue plus the debt issuance, will finance the total of the acquisition and all related costs, both related to the transaction cost and the restructuring costs.
Moving on to slide six, we show a detailed summary of the rights issue and the execution timetable. I think the slide is fairly self-explanatory, so I won't comment in detail. As I mentioned, the rights issue is fully underwritten, and our main shareholder, TryghedsGruppen, has earmarked more than DKK 12 billion, plus further participation on a cash-neutral basis.
Launch is today, and we expect the process to finish by the end of March. Moving on to slide seven, where we explain that TryghedsGruppen participates in the transaction with as much capital as possible. TryghedsGruppen, who owns 53% of Tryg today, is highly supportive of the transaction.
This is, of course, very important to Tryg, as is, of course, the continued, very successful customer-dividend model of the foundation. The board of TryghedsGruppen has voted to support the transaction, and they've provided irrevocable to both vote for the transaction at the general meeting and to provide capital support in the rights issue.
Bear in mind that by virtue of the transaction, TryghedsGruppen now becomes an insurance holding company, which they were never before, which means that in the future, TryghedsGruppen has to comply with the capital requirements of Solvency II, including the limitations that Solvency II puts on debt, etc. As previously disclosed, TryghedsGruppen will have an ownership of around 45% immediately post the transaction and aims to go back to about 50% medium term.
Moving on to slide nine, where we give an overview of the RSA acquisition. As we announced the 18th of November, Tryg will be acquiring the Swedish and Norwegian assets, and we will co-own the Danish asset on a 50/50 economic basis within Codan. This is truly a unique opportunity for Tryg to create the largest Scandinavian non-life insurer and to really transform our market positions.
The transaction will clearly step-change our profitability, and we will be able to deliver very strong returns to our shareholders. The total consideration for RSA is GBP 7.2 billion, and we are in Tryg paying GBP 4.2 billion for the RSA asset that we are acquiring, including, of course, our 50% stake of the Danish asset. And as you know, we've teamed up with Canadian Intact, who will take the rest of the RSA assets.
Moving on to slide 10, we elaborate on the highlights of the transaction. Clearly, we see this transaction as highly compelling, both from a strategic and a financial point of view. We will firmly establish Tryg as the largest non-life player in Scandinavia, with a pro forma gross premium of more than DKK 32 billion. And this transaction enables us to break into the top three in both Sweden and Norway.
Importantly, Tryg will become much more diversified, both in terms of top-line premium and bottom-line earnings. The transaction offers a very strong synergy potential of DKK 900 million pre-tax, and importantly, this is in areas where we have very strong and proven experience, for instance, from the Alka transaction a couple of years ago, and with the full synergies to be delivered by 2024.
In total, the acquisition creates very compelling value for our shareholders, with an ROI of around 7% and with high teens EPS accretion by 2023. The pro forma technical results, including synergies, will almost double, and therefore we expect a strong increase in our dividend capacity in the medium term as well. Moving on to slide 11, we look into the strategic rationale in more detail, increasing the top line by 43% to some DKK 32 billion, making us the largest Scandinavian non-life player.
In Sweden specifically, we increased the market share from 3% to 17%, and in Norway from 13% to 15%, creating a top three player also in those markets. In Denmark, we don't count our 50% stake in Codan in Denmark, and we will remain competitors in the Danish market. As such, Tryg's market share in Denmark will remain at the current 22.9% and unchanged. Clearly, as mentioned, diversification will increase significantly.
Sweden will become roughly 48% of future group technical result, Denmark around 42%, and Norway around 10%. Moving on to slide 12, where we look into the financial rationale in more detail. Synergies will be DKK 900 million by 2024, 80% of which relates to operating expenses, claims expenses, and claims procurement. Johan will comment in more detail on this in a second.
The knowledge and recent experience from the Alka acquisition in 2018 provides us with great confidence in our ability to realize the full synergy potential. The transaction, as mentioned, will generate an ROI of around 7%, high-teens EPS accretion by 2023. Then bear in mind that the full run rate synergies peak the year after, i.e., 2024, which will further improve the financial metrics.
We expect a solvency ratio of around 170 by the end of 2021, which is a robust level considering that we'll book most of the transaction and restructuring cost in 2021. As I mentioned, the full earnings capacity will almost double, and we expect the dividend capacity to follow a similar trajectory. Over to you, Johan.
Thank you, Morten. And following the financial rationale, let's move on to the structure of the transaction and split of assets that we have agreed with our Canadian partner, Intact. On Slide 13, we set out the parameters of the acquisition, and it is consistent with what we communicated on 18th of November.
Tryg will be buying the Swedish and Norwegian business while holding a 50/50 economic co-ownership of Denmark with Intact. Intact will buy the remaining RSA assets in U.K. and international, as well as Canada. We at Tryg are buying approximately DKK 10 billion worth of premiums, with the vast majority coming from Trygg-Hansa in Sweden and a smaller part from Codan and Norway. On Slide 14, we are displaying that besides the highly compelling strategic and financial rationale, we also see this transaction to represent a very strong cultural fit.
This is very important as it gives us great confidence in our ability to integrate seamlessly the RSA businesses to be acquired. Importantly, and also symbolically, the acquisition will ensure that the two Lifebuoy brands will be unified under the same ownership. These are both household brands with long history in their respective markets and now, for the first time, are part of the same group.
Tryg will be reinforcing our social responsibility values, primarily focused on safety, health, and well-being. The next few slides, 15 and 16, will comment on the performance of Trygg-Hansa and Codan and Norway in 2020. And please note that we still do not have control of the assets, and hence we'll only share a few views on this until closing of the deal. But let's start by saying that overall results are in line with our expectations.
Looking at the performance of Trygg-Hansa, it should be taken into account that the figures were impacted by a write-off of Swedish debtors of 260 million DKK, with 180 million DKK impacting premiums and 86 million DKK impacting expenses. Looking at the figures adjusted for this write-off on Swedish debtors, we saw a premium growth of 0.4% in total, with a flat premium income for the personal lines and a growth in commercial lines of 1.1%.
We did see an improved development for the combined ratio, which was 76.9% in 2020, against 78% adjusted for this write-off due to improved underlying profitability, especially in commercial lines despite a lower run-off result. Also, for the expense ratio, we saw a good development with an expense ratio of 14.4% against 14.7% when adjusting for this write-off.
Investment result was negative, primarily driven by a DKK 451 million negative value adjustment on real estate investment trusts versus a positive value adjustment of DKK 355 million in 2019, as well as a lower running yield on the fixed income portfolio. On page 16, we are double-clicking a bit further on the operating performance.
The improved underlying development in the claims ratio can be seen from an improvement in the gross claims ratio from 63.2% to 62.3% when adjusting for the previously mentioned write-off on Swedish debtors. As mentioned, the gross premiums development was flat from 19 to 20 for the personal lines when adjusting for write-off, and we saw an increase in premiums for commercial lines due primarily to price adjustments. The technical result improved significantly for the commercial business due to price adjustments, while we saw a somewhat lower technical result for personal lines after adjustments for write-off.
Now on page 17, let's turn to the synergies, as Morten mentioned earlier. Over the past several months, we have undertaken a significant amount of work, both to assess the potential synergies, but also to lay out a detailed plan for how to achieve them. We know the business we are acquiring extremely well and have taken full advantage of our recent and successful experience from the Alka transaction when planning for the synergies.
As such, we have great confidence in our ability to realize the full synergy potential, and as it can be seen from this page 17, we believe that the biggest potential for synergies are in Sweden, with DKK 500 million driven by FTE reductions, procurement, and IT savings, but also commercial synergies based on knowledge sharing between RSA Sweden and Tryg's Swedish business, Moderna.
In Norway, the estimated level of synergies is DKK 250 million, with more or less the same drivers as for Sweden, but at lower levels, as RSA Norway is much smaller than RSA Sweden. For Denmark and the group, we see estimated synergies of DKK 150 million, reflecting both sharing of central functions in Denmark and synergies related to investments. None of this is, of course, related to Codan in Denmark.
If we move on to page 18, we go into more detail on our plans, which again benefit from the recent successful Alka integration and our intimate knowledge of the business we are acquiring. In this slide, we are illustrating the synergy split on different types of functions. It is important to note that approximately 80% of the synergies are driven by costs, such as administration, distribution, claims, and procurement.
And for admin and distribution, we expect synergies of 370 million DKK, driven by a reduction in number of positions, reduced marketing spend, and also using the same core IT system. Tryg has been working with procurement in many years, and we expect to realize 220 million DKK through further leverage due to larger claims spent.
We also expect to realize 140 million DKK in claims through improved fraud detection and, in general, improved claims processes and policies in combination with the FTE reductions. Commercial synergies are expected to approximate 170 million through best practice sharing to be used for both repricing and development of new revenue streams in areas such as digitalization and child insurance. On page 19, we are highlighting one of the key attractions of this transaction to us. We are showing in this slide the expected premiums and pro forma technical result, including synergies post-transaction by countries.
Please note that the figures are rounded on our bridge towards a pro forma technical result of DKK 6.4 billion in 2024. As mentioned previously, this transaction will truly transform our position in Sweden, which is the largest non-life market in Scandinavia. And as a result, Sweden will become a significantly more important earnings contributor for the group, adding a very important element of diversification.
Through this, we expect to increase our premiums by 45% and almost double our technical result on a pro forma basis, including synergies. And with that, I will hand over to Barbara to present how this result translates into our dividend capacity. Barbara.
Thank you very much, Johan. Please turn to slide 20. We believe our dividend capacity will be significantly increased following the acquisition. In a challenging year like 2020, we increased our dividend, paying out a DPS of DKK 7 kroner and paying out approximately DKK 2.1 billion. We expect our total dividend capacity will double over the medium term following this transaction.
We appreciate our P&L will be somewhat noisy in 2021, taking into account the restructuring and integration costs, the transaction fees, and the equity accounting of the assets, which also feeds into the guidance for 2021 that Morten will take us through later. Our dividend policy will remain unchanged, and it's our aim to increase our overall absolute dividend amount. As you will see in the outlook for 2021, we're guiding a range between DKK 2.6 billion and DKK 3.0 billion Danish kroner interval for the dividends in 2021.
On slide 21, we're sharing our expectations for the solvency ratio development between the end of 2020 and the end of 2021. As you can see, we will remain robustly capitalized following this transaction without any change in policy in this regard. We expect a solvency ratio above 170 at the end of 2021, despite the solvency capital requirement is slightly higher than originally expected at around DKK 9.5 billion, previously guided in the range of DKK 8.5-9 billion.
The increase in the SCR should not come as a surprise, as Tryg's own SCR moved upwards by approximately DKK 300 million between Q3 and Q4 last year, driven by an increased market risk following a very robust capital markets development in the fourth quarter. Something similar happened to the perimeter that we're buying, to which some adverse currency moves should be added.
Our expectation is still that our solvency ratio will remain above 170% as per end of 2021. We have highlighted all the main moving parts in the blue box to the right, which hopefully are self-explanatory. On slide 23, we provide a current status on the M&A process. We have three key milestones ahead of us.
Today, as Morten mentioned, marks the start of the rights issue process after some intense work, and the process will come to an end during the month of March. The timing of the overall closing of the RSA transaction is expected in Q2 2021, and finally, it is worth remembering that we expect approximately six to nine months between the transaction closing and the separation of the Scandinavian assets, the demerger of Sweden and Norway from Denmark, in order to complete the transaction for us.
To have a full updated view on our business and our already strong presence in Scandinavia, we ask you to turn to slide 25. Currently, we are market leader, ranked as number one in Denmark with a market share of 22.9%. We're number four in Norway with a market share of 13.1% and number five in Sweden with a subscale market share of 3.4%.
We believe that almost 80% of our business is retail by adding our private and commercial segments. Denmark has until now clearly been the biggest country by geography, contributing by more than 60% of the premiums. On slide 26, you can see how our top-line growth has been accelerating in the last few years while maintaining a very strong profitability.
Fueled by our strategic priorities, which are focused on sales of new products, new strong partner agreements, increased retention and price adjustments, especially in the high-end corporate segment, have been key drivers of the growth. The combined ratio has remained strong and has improved further from 2016, landing at 84.5% for the full year 2020. Please move to slide 27.
As we have highlighted, Tryg runs a highly profitable, stable, and disciplined business. Our return on equity after tax of the business has consistently been around 20%-21% for many years now. As we have had limited increase in capital requirements, this has allowed us to return ample cash to our shareholders. Our dividend per share has actually increased for nine years in a row, and our intention is to return to this trend in 2022.
In the following section, we will give you a short recap on our Q4 results, including a status on the full year and CMD targets for 2020, as well as our outlook for Tryg as is. On slide 29, you can see that in Q4, Tryg reported a pre-tax result higher than DKK 1.2 billion, well above the comparison quarter in the last year.
The technical result was slightly better, while most of the difference came from the investment result, which was extraordinarily strong in Q4 following a very volatile year in the financial markets. The full year 2020 pre-tax profit ended at a strong DKK 3.54 billion, which, despite our technical result of DKK 3.495 billion being extremely strong, was slightly down compared to 2019.
The technical result benefited from a continuous positive development in the underlying business, lower than normal large and weather claims, and a positive impact from the lower economic activity. The underlying claims ratio improved by 20 basis points for the private segment and 60 basis points for the group in line with recent development.
As mentioned, the investment income was strong, with more than DKK 500 million in Q4, well above a normalized level. Equity markets performed very strongly in the last quarter of the year, ensuring a positive end to a year that will be remembered for extreme volatility amongst most asset classes. Tryg paid a Q4 dividend of DKK 1.75 per share, bringing the full year dividends per share to DKK 7 and leaving the year-end solvency ratio at 183%.
Tryg's business model proved very resilient in 2020, despite a difficult Q1 offset by a good recovery in all remaining quarters. On slide 30, you can see more details on the Q4 technical result, which was DKK 780 million, some 2% higher than Q4 2019. We believe that delivery of a technical result of DKK 780 million in what is normally a seasonally difficult quarter shows that the business is very healthy.
The result, not only in Q4, but for the full year, was driven by a strong performance of the private and commercial segments at a time with strong growth of respectively 9% and 6%. The corporate figures were hit by a high level of large claims in the quarter, approximately DKK 200 million or 3.5% on the combined ratio, but for the full year, it was more or less flat compared to 2019.
On slide 31, you can see an update on our customer highlights. We're very pleased to reach a TNPS score for 2020 of 72, which is up 4% in a year and against our CMD target of 70, a very strong result. We are very focused on improving customer KPIs, as we believe there is a very strong link between customer loyalty and retention, which also has a positive impact on the expense level.
The number of products per customer increased from 3.6 to 3.9 in this strategy period, which was at the beginning of 2018. We are satisfied with this development, and although we didn't meet the target of four products per customer, by working on understanding the customer journey and our touchpoints, we can target our efforts to where it really matters to our customers.
As an example, we can see that especially the higher sales in our car channel in Norway, Enter, has a negative impact on this KPI, as this is a single product distribution. But it also taught us how important it is to work with cross-selling and upselling, which we can see is, as an example, improving in the before-mentioned business in Norway.
TryghedsGruppen paid bonus to our Danish customers at the end of September and the beginning of October, and as expected, we could see a significant increase in the awareness of the customer bonus in Q4 2020, with an 18% increase compared to the same period previous year. We cannot leave 2020 without talking about COVID-19, so please turn to slide 32 for more details here. For the full year 20, COVID-19 ended up having almost no impact to the gross figures.
After significant negative impact in the first quarter for our travel insurance, we saw a gradual improvement in the following quarters due to lower activity in society. For the full year, we had a net positive impact due to a positive result from our travel insurance agreement. This is the first time for more than 10 years that we have had a positive impact from reinsurance for travel insurance.
From a customer point of view, we had 250,000 calls from customers related to COVID-19, and we saw approximately 100,000 COVID-19 claims. From the customer feedback we have received, we can see that we were able to help customers in a very difficult situation, and this at a time where our employees were working from home.
Obviously, we also saw that some lines of business were more impacted by COVID-19 than others, and furthermore, the development has been slightly different across the different geographies. For the big lines of business, the development was almost the same, with an increase in the number of claims reaching approximately 5%, which also reflects the growth in the business through 2020. With this, I will hand over to Morten to take us through the final result of the strategy period as well as the outlook.
Thank you, Barbara. And on slide 33, we are moving towards the end of the presentation. And on this slide, we show that all financial targets launched at the CMD in 2017 have been successfully met in 2020.
As you know, in March 2020, we abandoned the ROE target due to the COVID turbulence, but actually at the end of 2020, also the ROE target was met. You may have noticed that we moved the CMD from January this year to the autumn of 2021 to allow time to form our new strategy and our new financial targets, including Trygg-Hansa, Sweden, Codan, Norway, and Synergies.
The target period for our new financial targets will be 2024, similar to the peak of our Synergies. If we look at slide 34, we show our detailed 2021 outlook as announced previously in our annual report. Clearly, the most important item is our standalone technical result of DKK 3.3 billion-DKK 3.7 billion for 2021.
We have already disclosed previously that the total transaction cost of GBP 4.4 billion, including the very high FX costs on British pounds, we have published the split between 2021 and 2022, and we've given a specification of what impacts the balance sheet and what impacts the P&L.
Bear in mind that this is a once-in-a-lifetime chance to actually get an annual earnings outlook from Tryg because following the CMD in the autumn of this year, we will revert to our known practice of midterm financial and customer targets with a target period for 2024. Of course, we conclude with our favorite quote by John D. Rockefeller. Of course, we look very much forward to increasing our dividend capacity significantly with the RSA transaction. With that, we'll turn to your questions.
Ladies and gentlemen, to ask a question, please press five star on your telephone keypad.
To withdraw your question, please press five star again. We'll have a brief pause while questions are being registered. The first question comes from the line of Per Gronborg from SEB. Please go ahead. Your line will now be unmuted.
First, just a clarification. Can you hear me now? Am I unmuted now?
Yes.
Perfect. Thank you. The first question is just a clarification. The amortization of intangibles, if I look at prospectus page 264, you have another cost of DKK 818. Is that the number we should expect for the next 10 years? I believe we are guiding intangibles in the area of DKK 600-800 million per year going forward, Per. So that's the number you should be using. Can you reflect on what is on page 264 of your prospectus where you have a specific number?
I would have to revert to the IR team to follow up with you afterwards, Per, if that's okay.
That sounds great. My second question is on the reporting format. Also, if you look at the prospectus, it looks like you have given data on your traditional segmented information with the private business and the commercial business. How should we expect it to follow up on synergies after the deal has closed? Will that be on a country basis as you have guided for the synergies, or will that be on the segmented basis so we will see the synergies being distributed in a different way when the deal is closed?
I think, Per, you should expect that the segment format, which is the key driver of our reporting and has been so for a number of years, will also in the future be the key format of the reporting.
And then we will supplement that with additional information to allow for further transparency on the synergies fulfillment. So see that as two different angles to achieve the total overview as we'd want to deliver to you. So your advice is to continue modeling based on your three segments?
Yes. Perfect. My final question, and this is just out of curiosity. We saw on Friday that TryghedsGruppen decided to cut the customer dividend for next year. Any reflections on that? Well, I can give a few reflections on that. I think it falls a little bit in the same category as what should you pay in dividend for a year like 2021.
Clearly, this 2021 will be a year which is unusual in all manner of ways, both in terms of owning assets only for a period of time, having increased earnings only for a period of time, a very significant readjustment of the total exposure of TryghedsGruppen and their shareholding in Tryg, and clearly, they're signaling that they want to participate in the future shareholding and the rights issue as much as humanly possible.
A nd at the same time, they're signaling that they find the customer bonus extremely important, both now and for the future, and what they have signaled now is that for this year, they will pay 5%, which is within the range of 5%-8% they have communicated every single year, and at the same time, they've communicated that also for the future, they see the customer bonus scheme as being extremely important.
So, of course, we're very pleased that we see their continued support, and we're also very pleased that they will pay out a customer bonus in a year like 2021, which is quite tricky with a lot of new financial and capital-wise commitment on their side.
I think when you look at how the customers would perceive whether the number is 8% or 5%, it's our view that most of the private customers wouldn't really see much of a difference between the two numbers. It's really more the principle that you get a positive kickback to the customer and a positive reminder of being part of the TryghedsGruppen family. There might be some larger commercial or corporate customers paying more attention to whether the number for a given year is 5% or 8%. But I think we'll live with that.
Most of all, we're extremely pleased that TryghedsGruppen finds the bonus so important that they also pay a bonus in a year like 2021 where they have so much new commitment given the rights issue.
Okay. Thank you.
The next question comes from the line of John from Morgan Stanley. Please go ahead. Your line will now be unmuted.
Good afternoon. Thanks very much for taking my questions. The prospectus flags that TryghedsGruppen has been losing market share. I was just wondering how you intend to address this. And secondly, just wondering if we could get more details about how TryghedsGruppen's market share in child insurance has developed over the past few years, and maybe a couple of words on how you expect the profitability of the product to change over time.
I know you guys launched your own child insurance offering a couple of years ago. Just wondered if other insurers were trying to do similar things or trying harder to grow in that product in Sweden. Thanks.
So let me start the answering. I think we also showed in November that when you look at the more recent time series of the past four or five years, we saw a top-line growth in Trygg-Hansa in Sweden of some 2% over those years. And actually, that is equivalent to losing a little bit of market share every year. Not dramatically so, but a little bit of market share every year. Not unlike the situation we found in Tryg going back a few years. When we have modeled our business model going forward for Sweden, we have actually assumed that we would invest more in developing new products.
We would invest more in cross-sales, and we would invest more in broadening the share of wallet in the Swedish market. Not too many years ago, we had a growth of close to 0% in Tryg Classic. And what we saw that when we decided to put up the target for a billion of new products and services, and we decided to invest more heavily in new products, we found that we were able to grow the market and make the cake bigger, as we call it, not by stealing market share, but basically by adding more products per customer. And we've added almost 60 new products over the last couple of years.
When we talk to the managers of Trygg-Hansa in Sweden, this is one of the areas where they look the most forward to becoming part of the Tryg family because they clearly see that this product innovation strategy that has been very successful for Tryg, we can do together in the Swedish market.
And therefore, we would expect the 2% top-line growth that they've had in recent years, which is something that we will be able to increase. And an area where we will follow much the strategy that we have carried out in Denmark and Norway. And it's great to see that the new colleagues in Sweden from Trygg-Hansa are very, very excited to get there. And we've built the cost of that into our business model going forward.
When it comes to child insurance, I think it's fair to say that it was originally an area with fewer players. Now it's an area where more players are present, but it's also clear that it's a market which is still growing, and it's a market where you can add new coverages and new parts of the products, and clearly, Tryg has a very, very strong position in that segment, and a segment which is extremely important for customer loyalty.
Often, the children would stay for 18 years. You can build the family insurances, the house insurances, travel, the car on the basis of that, so clearly, this is a very important strength that we will continue to develop, but we do believe that it will be stronger when we add more new products to the equation, making it a broader platform than today, that's very clear.
Thanks, Morgan.
As a reminder, if you wish to ask a question, please press five star on your telephone keypad. The next question comes from the line of Steven Haywood from HSBC. Please go ahead. Your line will now be unmuted.
Thanks very much. Sort of following on from what you've just been saying, I see you've nearly got four products per customer for Tryg. Can you provide any details about what the products per customer is for Trygg-Hansa and as a co-owner in Norway? Or even better, maybe provide it as a number of products per family in Sweden. Thanks.
So Stephen, we'd look forward to providing those numbers after closing when we have access to the data.
But as you can probably imagine, then after a period where we've had access to due diligence and data room data, and now we've had access to prospectus data, that is only a subset of the total amount of data available in Sweden and Norway. So actually, after closing this summer, we will have full access, and then we will be able to give you much more color on the detail of the product exposure. But as of now, this is not data that we have access to.
Okay. I appreciate that. Hopefully, you can talk about the acquisition as it stands. Do you have any foreign exchange hedging in place for the deal going ahead? And can you give us any sort of update on the regulator approval process? I know there was obviously a longer-than-expected process with the Alka acquisition deal last time.
Yes. Hi, Stephen.
First of all, regarding the FX hedge, as you know, this deal is based on a U.K.-regulated deal. Then at the time of announcing the 2.7 back in November, we already did have an FX hedge in place. So we don't have any exposure to the strengthening of the pound that we have seen since we actually put forward the offer for RSA.
So we do have an FX hedge in place. And the cost of that, you will also see in the specifications of the cost for the overall transaction. Then when it comes to the regulatory process, where we are, obviously, you should look at this in two areas because you have the financial regulators, so the FSAs, in a number of countries across the global activities of RSA. And then on top of that, you have the antitrust. And I think the progress is as anticipated.
We see that there is a good dialogue in the various jurisdictions. On the antitrust, we have already obtained approval in both Sweden, Norway, and Canada. And we understand, again, it's Intact who's fronting this in Denmark, but we understand that there is a very good dialogue. And if you look at the DCCA's web page today, you can see that Intact has actually filed for, you can say, a simple process around the approval in Denmark. So from that perspective, everything is moving forward.
When looking at the FSAs, again, there are a number of jurisdictions where this has to be approved, the biggest obviously being the PRA in the U.K. And that, again, is a dialogue led by Intact, who will be owning the U.K. asset going forward. And we understand that that is progressing according to plan. So we are very comfortable with what we see.
That's great. Thank you very much. Very comprehensive.
You're welcome.
As a reminder, if you wish to ask a question, please press 5 star on your telephone keypad.
The next question comes from the line of [Terry Ko from Petty Group]. Please go ahead. Your line will now be unmuted.
Hi. Good afternoon, everyone. A couple of questions, please. The first question is just on the subscription price. I mean, I'm just keen to hear your thoughts around why was the subscription price set so low. Clearly, I mean, that leads to quite a bit more dilution, and that affects your DPS as well. I'm just curious to hear your thoughts. Maybe it's a mechanical thing, but any comments would be interesting. Thanks.
Yeah. Hi. No, I think what obviously has been going forward before launching the deal today is a very thorough review of deals like this.
And I think it's fair to say that the pricing that we come to market with is very much in line with previous standards, so you shouldn't see that as being extraordinarily high or low. It is very much in line with transactions that you would have seen in the marketplace comparable to ours.
All right. Thanks. And just a quick question around the business interruption litigation that's ongoing in the Norwegian and Swedish portion of RSA's business. I'm just wondering, what are the main risks around that? Is there a number that you could potentially quantify at this stage? And maybe what reinsurance cover that you have in place? And also just on that, I mean, can you give any reassurance that there's no such litigation risk associated to Tryg's own businesses?
Yes.
I think if we start with Tryg's own businesses, we don't have any exposure related to business interruption as it is, and we don't expect to see any of that. I believe the case that you are referring to is, you can say, the hotel case in Norway. And I think it's important to understand that the size of that particular case is in a few million Norwegian kroner. So it's not something that we see being material in any shape or form.
This was brought to court, I believe, mid-February, and we expect to have a closing of that particular court case now within a few weeks. But as I said, it's not something that we see being a market trend or something where there is a large exposure in the insurance policies of Codan Norway.
Okay. Thanks.
As there are no more questions at this moment, I'll hand the word back to the speakers.
Thanks a lot to everybody. This is Gianandrea speaking again. I just would like to mention that, of course, Peter and I remain available for any additional questions you may have. But thanks a lot for having been with us today.
Thank you, guys.
Thank you very much.