Suncorp is stepping up its game against Fairfax Financial Holdings in its takeover bid for Tower.

Disclosures to the NZX showed that Vero Insurance New Zealand, Suncorp’s wholly owned subsidiary, has made agreements to essentially lock in the shares it owns in the company.

According to an interest.co.nz report, on February 22, Vero agreed to buy 11.14% of Tower’s shares at $1.30 per share from various shareholders, and made a non-binding indicative proposal to buy the rest for the same price.

A couple of days later, it agreed to buy additional shares for the same price, specifically from the New Zealand Superannuation Fund, upping its stake to 13.29%.

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The sale these shares has been settled since then.

With every transaction, Vero arranged to make an “escalation payment” to sellers, offering to pay them the difference between the $1.30 per share it paid and any greater price paid to other Tower shareholders in the next year. It also offered to pay the difference for any on-sold shares over the next year.

Suncorp’s move comes as the Kiwi insurer awaits shareholder and regulatory approval to sell 100% of its shares to Fairfax for $1.17 each, the report said.


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