Friends Provident finds Resolution in merger talks
25 July 2007
The UK''s fourth largest insurer, Friends Provident, and closed life consolidator, Resolution, are reported to be in exploratory talks on a merger that would create an £8.3- billion insurer, says a report in the London-based The Times.
According to the report, discussions between the two insurers are said to have been going for several months and that they hoped to make an announcement within a fortnight.
Last May Resolution acquired Abbey National''s life insurance business for £3.6 billion, to enter the open funds market. Resolution, which has a market capitalisation of £4.3 billion, is believed to be keen on more acquisitions.
Friends Provident has charted aggressive expansion plans that would enable it to increase its profits in the UK from £64 million in 2005 to between £180 million and £200 million by 2008 and is believed to locate additional cash flows to drive its expansion.
has been the subject of takeover speculation since its
inception in 2001. According to a report US private
equity firm JC Flowers is said to have approached Standard
Life and AXA to consider making a combined bid for Friends