Corvus Capital has confirmed that it is evaluating the UK's second-largest insurer Royal & Sun Alliance Plc as a potential takeover target.

Aim-listed Corvus Capital, a UK investment company fronted by entrepreneur Andrew Regan, has confirmed that it is considering making a bid for Royal & Sun Alliance (RSA).

Corvus confirmed in a statement that considerations in relation to RSA are in the early stages, and that the insurer is one of a number of potential investment and acquisition opportunities, and gave no guarantee that any offer would be forthcoming.

Analysts have commented on the ambitious scale of the bid, given the disparity in size between the two companies. The Financial Times has also drawn attention to previous failed bids made by chief executive of Corvus Capital, Andrew Reagan, and commented that in order to make a bid, the company would have to borrow heavily.

Royal & Sun Alliance’s shares have lost almost three-quarters of their value in five years, and in recent times the insurer has scaled back its business, selling its life unit to Resolution Life Group for GBP850 million.