Media organisations describing the QBE move as a “bid” are likely to be hearing from IAG, which is insisting journalists get it right.  For the record, it’s a “proposal”, which IAG says is a very different thing.

And IAG appears to have right on its side. M&A experts say QBE has “put a proposal” to IAG for the consideration of its board and shareholders that includes a scheme of arrangement to merge the two companies under QBE management.  

“The proposal requires the IAG board to give consent before anything else can happen,” one market source told insuranceNEWS.com.au. “If the board did agree it would then have to refer to the shareholders to obtain their support.”

Under a takeover bid, QBE would have to make a direct offer to IAG shareholders and most likely acquire shares to force a takeover. It hasn’t yet taken this approach.

“QBE is obviously being careful not to refer to its proposal as either a ‘bid’ or an ‘offer’, at least at this stage,” the source said. “At present it’s only a proposal or a proposed scheme of arrangement.”