ALEX BRUMMER: LV’s stunning U-turn on Royal London merger

ALEX BRUMMER: LV turning his back on Royal London is one of the wackiest boardroom U-turns in living memory

The reasoning behind Liverpool Victoria’s decision to pull out of a second round of merger talks with compatriot Royal London is unfathomable.

LV boss Mark Hartigan and outgoing chairman Alan Cook have spent much of the last year trying to convince skeptical policyholders, MPs and the media that the historic life insurance company is not had no choice but to sell himself in order to survive.

He spent tens of millions of member funds, which could have increased savings, on advice and legal fees. Today, he recognizes that it was a waste of time because the insurer is doing wonderfully and can maintain its independent status.

Mystifying: After failing to convince its members to take up an offer from private equity giant Bain, LV has now dropped out of a second round of merger talks with fellow mutual Royal London

The switch is one of the wackiest boardroom reversals in memory. The disgraced general manager, Hartigan, showed a huge brazen neck and disrespect for the reputation and traditions of a friendly society.

He led the members and the City in a reckless and dishonest campaign to place the fate of LV in the hands of private equity barons Bain Capital.

We now learn that the rejected deal with Bain and a proposed link to respected mutual Royal London are unnecessary.

The scurrilous claim that LV could not meet its long-term debts, having passed the milestone and raised £1.1billion from the sale of its prized car insurance business, never stood up to the exam.

Hartigan, paid £1.2million in 2020, was so determined to run the new LV, under the ownership of Bain Capital, that he couldn’t see past his own wealth-building opportunity.

The chief executive has placed acting chairman Seamus Creedon in an odious position. Creedon’s statement that LV’s commercial performance and operational progress has rendered a deal superfluous is tantamount to a U-turn on the M3 motorway towards Poole.

If Hartigan had an ounce of honor, he would resign immediately. In the absence of this, the members should insist that he be dismissed with immediate effect and without payment beyond the minimum contractual requirements.


Emma Walmsley continues her efforts to re-establish Glaxosmithkline’s (GSK) status as one of the world’s leading life sciences companies.

Key to the CEO’s strategy will be the separate listing of his cash-generating Consumer Healthcare arm.

After turning down a handsome £50billion trade sale offer to Unilever, anything that places it at a lower value could be terminal for the group’s current management.

GSK’s fate therefore hinges heavily on market conditions in a volatile year with rising interest rates on both sides of the Atlantic.

The outlook for the pharmaceutical and related vaccines business also looks disappointing.

As one of the world’s leading vaccine manufacturers, it has made great inroads for people suffering from shingles and meningitis.

But the £1.4 billion in Covid-19 sales (especially compared to Pfizer and Moderna) is a deep disappointment.

Indeed, sales of its Covid treatment, xevudy, will make a lesser contribution in 2022 due to shrinking margins.

The departure of bioscience guru Hal Barron in August is also unnecessary.

GSK has a strong drug and vaccine pipeline that is paying off, including its transformative HIV treatment that could revolutionize patient regimens.

And he’s fighting to get back into the oncology space recklessly abandoned by Walmsley’s predecessor.

It is essential for life sciences in the UK that Walmsley keeps campaigners at bay and receives good help from the Medicines and Healthcare Products Regulatory Agency in the form of smarter approvals.

What cannot happen is that GSK pharma is considered too fragile to fend for itself and falls into the hands of foreign predators.

New challenge

So far I’ve avoided entering the new Amazon Fresh store on our high street, happy to pivot between a large Waitrose and a Tesco Express.

But we use the Amazon Fresh delivery service (largely Morrisons products) and buy specialty items from Whole Foods.

The online shopping giant is clearly looking to compete with established grocers, so it’s only fitting that the Competition and Markets Authority insists it abides by the too easily abused supplier code of practice, as has been seen at Tesco in 2015.

For too long, Amazon and the other digital giants have lived outside the confines of anti-trust rules and national taxation.

It must end.


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