Friends Provident International (FPI) has suggested a fresh round of consolidation in the offshore life industry may begin in the next 18 months as its new owner Resolution seeks out more takeover targets.
FPI, which yesterday reported a 30% year-on-year drop in business for the first six months of 2009, has been told by Resolution to continue with “business as usual”, according to Rocco Sepe, managing director of the Isle of Man life company.
And he highlighted that Resolution’s commitment to further consolidate UK asset managers and life offices could see other international operations brought into the fold.
“The takeover brings opportunity for further expansion through acquisition. Most life companies in the UK have international interests so it stands to reason that other international operations could fall under the control of Resolution. Then we would have to look at the best way of putting those businesses together.”
Sepe said there was as yet no hint – publicly at least – as to which life companies may be takeover targets but noted: “[Resolution has] been very active in considering potential candidates already and is talking about 18 to 24 months to acquire and consolidate new businesses.”
The management team of Friends Provident, headed by Trevor Matthews, will remain the same following Resolution’s takeover, as will FPI’s.
Sepe said FPI’s sales, though down year-on-year, were 20% up in the second quarter compared to the first. In total, first half sales in 2009 were £81m compared to £117m for the first six months of 2008. In the Middle East sales were flat year-on-year at £21m – but fell in all other markets.
