Watchdog must flex its muscles to intervene in private equity takeover of LV, experts urge

By Lucy White For The Daily Mail

Published: | Updated:

The City watchdog must use its powers to intervene in the controversial takeover of LV, experts have urged.

The Financial Conduct Authority (FCA) should take a ‘broader interpretation’ of its powers to examine whether the proposed sale of the mutual insurer to US private equity shark Bain Capital is in customers’ best interests, critics of the deal claimed.

As the backlash grows over the deal between historic life insurer and Bain, the FCA is facing its first key test under new leadership.

Probe call: The Financial Conduct Authority should take a ‘broader interpretation’ of its powers to examine whether a sale of LV to Bain Capital is in customers’ best interests, critics claimed

Probe call: The Financial Conduct Authority should take a ‘broader interpretation’ of its powers to examine whether a sale of LV to Bain Capital is in customers’ best interests, critics claimed

Nikhil Rathi, who took the helm of the watchdog earlier this year, has promised that under his leadership the FCA will be bolder and more ‘proactive’ in the face of potential harms to consumers.

But so far the regulator has refused to step in over the Bain deal. It has claimed that it can only look at the deal which LV has placed before it, and assess whether consumers are treated fairly.

The FCA said it is not able to take a broader view and consider whether other options on the table for LV – including a rival bid from fellow mutual Royal London – may have been better for members.

But Tory MP Kevin Hollinrake, a prominent campaigner on fairness in financial services, said: ‘They should be looking at whether LV’s board are doing this deal for members, as the suspicion is that they’ve got their own interests in mind.’

And Baroness Altmann, a former pensions minister, said the case is ‘worthy of proper investigation’ adding that ‘it could disadvantage 1.2m customers’.

Make your voice heard on LV 

We are encouraging LV members, customers, or others, who would like to see it retain its mutual status, rather than be bought out by private equity,  to write to it.

You could use the wording from the letter printed in the Daily Mail newspaper's City pages (pictured here).

We have included the words for you to copy and paste into a letter below. 

Send it to Alan Cook, Chairman of LV=, Liverpool Victoria, County Gates, Bournemouth, BH1 2NF 

Dear Alan Cook,

I, the undersigned, urge you to reconsider your decision to sell LV= to Bain Capital and instead maintain its mutual status. 

Watchdog must intervene in private equity takeover of LV, experts urge

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