Friends Provident has confirmed it has received a 150p per share proposal from US private equity investor JC Flowers. The cash offer values the life assurer at Gbp3.5bn (US$7bn). It is subject to due diligence and other conditions.
The proposal indicated that the offer price would be reduced in the event Friends Provident paid shareholders the final dividend, already proposed, of 5.3p per share.
Friends Provident said it has informed JC Flowers its proposal “significantly undervalues Friends Provident and its prospects and does not represent a basis for discussion.”
In a statement, the group said it remains focused on the implementation of its strategic review announced on January 31 and will update shareholders on progress when delivering interim results.
The board is expected to hold out for an offer of at least 160p a share, as this reflects the “embedded value” of the group's life assurance policies.
JC Flowers made a 175p per share approach to Friends Provident in January.
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