Life Company Investor Group, an organization backed by entrepreneur Hugh Osmond, has agreed to raise its offer for the life insurance businesses of UK fund manager HHG Plc by GBP45 million, following news last week that Resolution Group held an interest in the assets.
HHG said that it has now entered into an amended agreement that will see Osmand’s Life Company Investor Group (LCIG) pay GBP1.07 billion, having originally agreed to sell its closed life assurance businesses in December for GBP1.025 billion. The new arrangement also dictates that HHG terminates its discussions with Resolution Group.
In an informal approach made last week, Resolution indicated that it would be willing to buy the businesses, which include Pearl Assurance, NPI and London Life, for around GBP1.15 billion. However, because this proposal was subject to extensive due diligence and discussions with third parties and LCIG’s revised offer was essentially an ultimatum, the HHG board has endorsed the latest approach from Osmand’s group.
The HHG board had a straightforward choice – delivering shareholder value by accepting the certainty of the existing agreement with improved terms or taking a gamble on Resolution’s proposal and risk LCIG walking away from the deal, explained HHG chief executive, Roger Yates. The board’s decision delivers certainty and improved value for shareholders at no further risk.