UK Insurer LV= Attracts Bidders Including Phoenix, Cinven: Sources

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UK insurer Liverpool Victoria has attracted interest from rivals including Phoenix Group Holdings and private equity firm Cinven Ltd., according to people familiar with the matter.

Fellow mutual insurer Royal London, Utmost Life and Pensions and European Insurance Consolidation Group are also among potential suitors, the people said, asking not to be identified as discussions aren’t public. LV= is working with financial services specialist Fenchurch Advisory to explore options including a full or partial sale, they said.

Bids were submitted this week for the company, which could be valued at 500 million pounds ($631 million) to 1 billion pounds, according to the people. LV= may also decide against selling and opt to redistribute capital and pursue organic growth, one of the people said.

Representatives for LV=, Cinven, Phoenix, Royal London and EICG declined to comment. Representatives for Fenchurch and Utmost did not respond to requests for comment. Sky News previously reported on a possible sale.

Any sale by LV= would continue a strong run of dealmaking in the insurance sector despite the broader slump in mergers and acquisitions brought on by the coronavirus pandemic. The value of insurance M&A is up 26% over the last 12 months, according to data compiled by Bloomberg.

Helping to drive the trend has been the purchase of closed life insurance policies in Europe by private equity firms and other consolidators. Allianz SE and Assicurazioni Generali SpA are among those gearing up to sell billions of euros in life assets.

For Cinven, a deal for LV= would allow it to add to a suite of insurance investments that includes life-market consolidators Eurovita in Italy and Viridium Group in Germany.

LV= was founded in 1843 to provide an affordable way for people to cover the cost of funerals. It expanded into a company offering a range of insurance, investment and pension products to around 1.3 million customers. In 2019, LV= sold the remainder of its its general insurance business to Allianz. It appointed Zurich Insurance Group’s Mark Hartigan as chief executive officer in December.

–With assistance from David Hellier.

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