LV chairman quits as members block Bain takeover

The chairman of LV= has quit after members of Britain’s oldest mutually-owned life insurer failed to back a controversial £530m takeover bid by a US private equity firm. 

Alan Cook said that he will stand down next year after following the failure to win support from 75pc of voting members for the takeover by Bain, which was founded by Republican senator Mitt Romney.

LV= is now holding talks with rival Royal London about a tie-up instead.

The company only secured support for the deal from 69pc of members who voted, meaning the transaction failed as LV= needed to convince three-quarters of them to accept the offer. 

Around 1.2m policyholders were eligible to vote, but only 15pc took part in the ballot in a sign of widespread apathy. Members were set to receive £100 each if the deal succeeded.

The result comes after a prolonged campaign against the transaction by a vocal group of members and politicians, who did not want the mutual falling into the hands of private equity.

LV= has faced criticism in recent weeks for a perceived lack of transparency regarding details of the sale. Members were expected to foot a £43m bill for City firms working on the sale, details of which the mutual insurer was accused of burying on its website.  

The business said that it will now seriously consider a proposal for a deal with Royal London, in a marked change of tone after it previously attacked overtures from its fellow mutual.

Mark Hartigan, the chief executive of LV=, even accused rival Royal London of “lobbing a grenade” into deal talks as his board sought to seal the agreement with Bain.

A spokesman for LV= confirmed it received an unsolicited preliminary merger proposal from Royal London on Wednesday, which is at an early stage and is subject to discussion. 

He added: “The proposal, which is on a substantively different structure to the offer received during the process in 2020, now includes the possibility of continued mutuality and is conditional on exclusive discussions.”

A spokesman for Royal London said: “Royal London can confirm that it has offered to enter into immediate and exclusive discussions with LV= to agree a mutual merger that will offer LV= customers the opportunity to have their life savings protected and invested by a mutual.”