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Equitablebegins topreparefor a sale.

Byline: By Matt Dickinson

Equitable life chairman Vanni Treves said yesterday that the mutual life assurer had started preparations for the possible sale of the business.

Mr Treves, who is non-executive chairman, revealed that the 245-year-old society would be ready to invite bids in the new year.

Equitable was brought to its knees in 2000 when it lost a legal battle in the House of Lords over the rights of its policyholders, forcing it to close to new business.

Once worth pounds 26bn in its prime, it now has around 180,000 with-profits policyholders and a pounds 7bn with-profits fund.

Mr Treves said, "As we speak, we are putting together a data room full of information. People interested in finding out everything about Equitable Life on the basis of confidentiality will be able to do so. They need that information in order to prepare a bid for all or part of the society."

Mr Treves said he took the step after receiving "half a dozen" informal approaches.

The mutual, which is the UK's oldest mutual life assurer, was expecting to receive formal offers in the spring, he added.

Earlier this month Equitable passed a key hurdle in the way of a sale after it revealed it had nearly completed a pounds 1.7bn transfer of pensions to insurer Prudential.

The with-profits annuity book represents around 20% of Equitable's with-profits fund and consists of 62,000 policyholders.

Many potential buyers of Equitable are thought to have previously been put off by the complex nature of the scheme.

The transfer is the second major deal for Equitable Life this year, after it completed the transfer of its pounds 4.6bn non-profit annuity book to Canada Life in February.

Mr Treves said, "Now the society is a less complicated organisation, I think we will be even more attractive. What we have the possibility of doing now, which we never had before, is balancing the benefits to policyholders of selling what remains against the benefits of just carrying on for the next 30 to 35 years."

Buying closed pension funds has become more attractive in recent years, with specialist insurers pooling together the assets in the hope of getting a better return.

Policyholders at Equitable are still waiting for a report by the Parliamentary Ombudsman to see if they are entitled to government compensation over its role as regulator in handling the 2000 crisis.
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Title Annotation:Business
Publication:Western Mail (Cardiff, Wales)
Date:Dec 22, 2007
Words:400
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