Cowdery will not be put off Friends deal
RESOLUTION, Clive Cowdery’s buyout vehicle, is determined to fight on with plans to take over Friends Provident despite an unequivocal merger rejection from the life insurer yesterday.
The buyout firm believes a deal will take place, whether it is a friendly transaction that keeps Friends’ board in place or a hostile takeover, according to a source close to Cowdery.
And the fact the Friends share price continues to hover around yesterday’s close of 72.2p, valuing the group at around £1.69bn, indicates that is the price shareholders feel the deal will take place at.
“We are not thinking in hostile terms at the moment, we are hoping with more pressure from the shareholders a deal will be done,” the source said.
This came after Friends yesterday ended talks with Resolution after rejecting a fresh takeover approach from the Guernsey-based bid vehicle over the weekend.
“The board of Friends Provident sees no basis for further engagement with Resolution and has terminated discussions,” it said.
Resolution offered to buy the insurer for 0.82 of its shares for every Friends share valuing it at £1.7bn – seen as relatively low by most analysts. The vehicle also threw in a £500m cash sweetener entice a friendly transaction.