Royal London is poised to launch an accelerated bid for rival LV if a sale to US private equity giant Bain collapses on Friday, The Mail on Sunday has learned.
Members of mutually-owned insurer LV will submit final votes this week with a minimum of 75 per cent required to approve the deal.
Last night, sources said the vote could go to the wire, with one suggesting advisers on the deal were already considering ‘contingencies’. An official takeover bid by Royal London will quell weeks of speculation over whether the pensions giant will swoop to salvage LV. A source said Royal London will be ‘ready quite soon’.
Set to enter the fray: An official takeover bid by Royal London will quell weeks of speculation over whether the pensions giant will swoop to salvage LV
It is understood that Royal London could make the offer as soon as a week tomorrow. But it will not come forward with a counter-bid unless LV’s members vote against the sale to Bain.
It is possible Bain also could table a new bid.
LV’s plan to sell to Bain for £530 million has met a wave of opposition. Critics have warned members they will receive just £100 in return for giving up their mutual status. But, in a last-ditch attempt to swing the vote, LV last week sent an email urging its 1.2 million members to support the deal.
The email, seen by The Mail on Sunday, said voting against the deal ‘will not see LV remain as it is today’.
It added: ‘We will still have to seek a buyer, which will lead to further deal costs being incurred, the likelihood of lower returns for members than the Bain Capital transaction, as well as the potential loss of brand and jobs.’
It said 271,000 with-profits policyholders will receive between £52 and £630 on average, depending on the policy amount and time held.
Royal London’s counter-bid will involve a merger with LV.
Make your voice heard on LV
We are encouraging LV members, customers, or others, who would like to see it retain its mutual status, rather than be bought out by private equity, to write to it.
You could use the wording from the letter printed in the Daily Mail newspaper’s City pages (pictured here).
We have included the words for you to copy and paste into a letter below.
Send it to Alan Cook, Chairman of LV=, Liverpool Victoria, County Gates, Bournemouth, BH1 2NF
Dear Alan Cook,
I, the undersigned, urge you to reconsider your decision to sell LV= to Bain Capital and instead maintain its mutual status.
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