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Wednesday 20th of August 2008
November 14, 2007

Chief of Friends Provident steps down


by Kay Murchie
”Chief

Friends Provident has announced that its chief executive, Philip Moore, has resigned after less than 12 months in the role following a failed merger attempt with Resolution, the closed fund consolidator. Friends Provident has now launched a strategic review of the business with an update to be provided in January.

Mr Moore will be replaced on an interim basis by chairman Adrian Montague.

If the Resolution merger would have gone ahead, it would have helped to provide cashflow to fund Friends Provident’s expansion. However, the company previously said that if the merger was unsuccessful, it would increase its borrowings by £500 million instead. The failure of the merger could see Friends Provident lagging behind in what is expected to be a wave of consolidation in the insurance sector.

The merger was scuppered after the outbreak of a bidding war between Pearl Assurance and Standard Life for Resolution. Standard Life withdrew from the fight, leaving Pearl almost certain of triumph. Friends Provident will receive a £49 million payoff from Resolution as compensation for the broken partnership.

It has been a challenging year for Friends and its management team but we remain confident of the group’s outlook, said Mr Montague. He added that it is right that we look at the group’s strategy to ensure that we are delivering the highest value available to shareholders. The board has confirmed that this requires a change in the management team.

Mr Moore’s integrity was already being questioned after he initially insisted that Resolution and Friends Provident were incompatible but later agreed to the merger.

Prior to joining Friends, Philip Moore was director of finance and head of mergers and acquisitions at AMP’s UK business.

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