Freshfields, Linklaters scoop Widows work
Leading outfits advise on Lloyds TSB acquisition
June 30, 1999 at 08:03 PM
2 minute read
Linklaters & Alliance has formed a 45-lawyer team to advise Lloyds TSB on its proposed £7bn acquisition of life assurance mutual Scottish Widows.
Corporate partners Alan Barker and Donald Williams are leading the team advising Lloyds TSB and are working alongside Lloyds TSB's group chief legal adviser Geoffrey Johnson and in-house lawyer Andrew Scott-Plummer.
Scottish Widows, the UK's sixth-largest life assurer, has instructed Freshfields, led by corporate partners Ian Poynton and Philip Richards.
Barker said that under the proposals Lloyds TSB would spin-off the Scottish Widows business into a new company – demutualising it in the process – that would be owned by Lloyds TSB.
He added that the deal was the first time policyholders of a mutual company would be paid directly for loss of estate – the bundle of assets held as a cushion by a mutual in case of troubled times.
He said cash payments in similar deals usually came from existing or future profits – as was the case in the demutualisations of both Scottish Amicable, which completed in September 1997, and NPI, which is set to complete at the end of this year.
In this deal £500 will be given to eligible policyholders with any kind of life policy in Scottish Widows, but with bonuses or 'with profits' payments, the figure could reach £6,000 – the largest to date.
Lloyds TSB will pay out a total of £2.8bn to policyholders – almost half of the £5.7bn cash payment set out in the deal.
Barker said that subject to approval by the Financial Services Authority the payments were possible because of the financial strength of Scottish Widows.
He added: "This deal is a significant milestone in the consolidation of the life assurance sector, which is very fragmented. There are a large number of participants in the sector and there will be a lot of consolidation within the next 10 years."
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View AllSkadden to Close in Shanghai and Make Cuts to China Corporate Practice
DWF Group's Canadian Firm Set to Add Fourth Office With 16-Lawyer Montreal Team
UK Law Firms Face £75M Money Laundering Investigations Alongside Russia Scrutiny
3 minute readTrending Stories
- 1The Law Firm Disrupted: Playing the Talent Game to Win
- 2A&O Shearman Adopts 3-Level Lockstep Pay Model Amid Shift to All-Equity Partnership
- 3Preparing Your Law Firm for 2025: Smart Ways to Embrace AI & Other Technologies
- 4BD Settles Thousands of Bard Hernia Mesh Lawsuits
- 5A RICO Surge Is Underway: Here's How the Allstate Push Might Play Out
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250