Pearl to make bid for Resolution

Source: Exec Digital UK

Date :27/09/2007 11:33:12

Pearl Assurance, the closed life-fund company is preparing to make an all-cash offer for its main rival, Resolution.

The company is expected to pitch its bid below the life company’s Wednesday share price.

Pearl who currently holds a 16.5 percent stake in Resolution is understood to be considering an offer at or slightly above 660p a share, a 5.6 percent discount to Resolution’s closing price of 699p.

This would value the company at £4.5 million.

Possible threat

The intervention would pose a threat to Resolution’s proposed merger with Friends Provident, which aims to create an £8 billon life assurance giant.

Although Resolution said last week it remained commitment to the deal, it admitted that it had opened its books to Pearl and Standard Life, the Edinburgh-based insurer.

Pearl’s move is likely to coincide with the posting of the offer documents for the Friends merger, due in early October.

Pearl currently looks after £19.8 billion in closed life funds on behalf of 3.5 million policyholders.

It has yet to make a comment on any possible bid.

September 27 2007

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