The proposed Resolution and Friends Provident merger will create "significant risks" for both parties, Pearl Group warns.
The Hugh Osmond led company believes the merger would not value for shareholders, compared to other options.
It says the amalgamation would “expose them to the significant risks of integration and of the synergies promised not being realised”.
It was widely tipped Pearl, which has built up over a 16% stake in Resolution, will make a bid for the company perhaps as early as next week – a claim rebuffed by the group in a statement today.
“There can be no certainty that Pearl will make an offer for Resolution or as to price or timing of any such offer,” Pearl said.
“Pearl considers the current market price of Resolution to have been affected by press and market speculation regarding possible offers for Resolution, and the potential value of Resolution shares.”
Should it make a bid, Pearl will take into account Resolution's share price of 616p on 25 July, the merger announcement date, and its "see through" price of approximately 575p, based on the original merger terms relating to Friends' closing share on 27 September.
If Pearl decides against launching a bid for Resolution, Standard Life is waiting in the wings to swoop. The insurer last week announced it is considering a cash and shares offer for Resolution.
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