Bain ousted in bid for LV=; Royal London ushered in for possible tie-up

UK insurer Liverpool Victoria Friendly Society (LV=) has failed to secure member approval for a planned sale to private equity firm Bain Capital and will now turn to Royal London for a possible tie-up.

The company's management revealed the news in a series of market filings following a Friday (December 10) special general meeting.

A management-backed deal to sell to Bain Capital secured only 69 percent of votes present at a member meeting, short of the 75 percent required, a market filing showed. Only 15 percent of member votes were present at the meeting. LV= members had put forward concerns about demutualisation in the Bain deal, management noted.

Royal London stepped in with a fresh offer ahead of the vote and will now be front and centre in LV= attempts to “move swiftly to reassess its strategic options.”

The new offer looks "substantively different" than the one received in 2020 and now includes "the possibility of continued mutuality," LV= said of the latest from Royal London. The Royal London offer is conditional on exclusive discussions.

"There can be no certainty that a transaction will be agreed," LV= management warned, citing the need for due diligence and "detailed negotiations" of price and terms. "The Board will consider this proposal seriously and undertake to update members as soon as practicable."

Long-term business as usual is not an option. “As we have said throughout this process, the growth and investment required to remain competitive over the long-term is not a fair or appropriate burden for our With-profits members to bear,” chairman Alan Cook was quoted saying in the market filing.