Members of mutual insurer Liverpool Victoria (LV=) will be slapped with a £43m bill to cover the costs of the controversial £530m takeover bid by a US private equity firm, according to reports.
Despite calls last week from Business secretary Kwasi Kwarteng for transparency from the insurer about how much bankers, lawyers and lobbyists stand to make from the proposed sale of the mutual insurer to Bain Capital, LV= resisted giving up how much it was paying in fees for the sale.
But a report by Oliver Gillespie of consulting firm Milliman, hired by LV= to evaluate the sale for its members, has included an estimate of the total costs to the insurer, according to The Times, which first reported the news.
The report by Gillespie was published at the start of the month.
The costs of the proposed takeover by Bain, which will end the firm’s member-owned status, are, according to the report “estimated to be £43 million.”
Splitting the cost between the insurer’s 1.16m members means it works out to £37 per member – over a third of the payout LV= has offered members should the deal go ahead.
The newly discovered cost to members of the deal suggested “quite a feeding frenzy,” LV= member Peter Bloxham told the Times.
The news comes amid rising tensions as the proposed takeover deal of LV= has come under increased scrutiny after the mutual insurer announced that its members would receive just £100 each from the £530m sale to Bain, which will end LV’s status as a mutual after 178 years.
The mutual’s 1.16m members will vote to approve or reject the Bain deal on December 10 – three quarters of the votes are needed for the takeover to go ahead.