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Insurance takeover vehicle Resolution reckons it has digested Friends Provident and is ready for its next meal.
Resolution is typically linked with medium-sized deals, but claims there is no limit to its appetite.
Noting the similarity of the shareholder registers of many insurers, chief executive John Tiner reckons it is merely a case of which deals make sense to those investors.
“We would do what our shareholders want us to do,” he said today.
Tiner hopes Resolution shares — they joined the FTSE last week — will be tempting currency for an industry desperately in need of consolidation. Many Friends Provident shareholders agreed to take Resolution shares rather than cash, a pleasing development for Tiner and co.
The company, founded by insurance entrepreneur Clive Cowdery, has £310 million of cash on hand but would raise more to aid deals. Legal & General and Scottish Widows, part of Lloyds Banking Group, are often named as targets.
Friends' third-quarter sales reflect the tough times in the sector. Sales of savings schemes are down while Brits fret about the recession. Under chief executive Trevor Matthews, Friends reckons its strongest niche could be simple protection policies. It sold £73 million worth in the past three months, up from £66 million for the previous quarter.
Friends earlier signed a deal to sell life insurance via Tesco and today unveiled a similar deal with Virgin Money — assurance that will be sold over the net under the Virgin name.
Reader views (1)
dear sir could you tell me ,as a friends provident endowment policy holder,am i entitled to any free shares from the resolution takeover
- David Bowles, eastbourne, england, 25/01/2010 18:00
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