IL&P goes lukewarm on stock-market flotation
IRISH Life & Permanent is no longer "actively pursuing" plans for a stock-market flotation of its life-insurance business, even though there may be as few as two potential buyers left in the race to buy the insurer.
IL&P had previously mooted a stock-market flotation as a 'Plan B' if the life insurer failed to attract sufficient bids, but sources last night confirmed that that process was no longer being "actively pursued".
This means there is now an increased chance that Irish Life Assurance will remain part of IL&P, although sources stressed that there was no certainty about the outcome at this point.
After inviting five bidders to submit second-round offers, the Government had hoped that there would be enough bidders left in the fray to ignite a competitive bidding process.
It is understood that there are now no more than three bidders left, with some sources suggesting that the field has narrowed to just two.
A spokesman for Irish Life & Permanent declined to comment, as did a spokesman for the Department of Finance.
However, sources pointed out that Irish Life Assurance could still fetch a good price from the reduced field if the remaining bidders wanted it badly enough.
Others said that even though a flotation was no longer being actively worked on, it could be "reignited" if the sale process failed to result in a deal.
Market sources are increasingly sceptical about the viability of a stock-market flotation in the short term.
"It would be hard to float a company anywhere in Europe, never mind in Ireland," one source said, adding: "I just don't see how it can be a runner."
Irish Life Assurance initially attracted a better than expected response from would-be buyers, with US insurer Unum, Delphi Financial Group and a joint bid from JC Flowers and Apollo Global Management joining Canada Life Ireland and private-equity player CCV in the final five.
Unum and Delphi have both dropped out and some sources suggested that another bidder had been effectively eliminated.
The sale of the life insurer was expected to contribute about €1bn to IL&P's capital base, bringing the plc close to the capital demand imposed by the Central Bank's stress tests.
If the life insurance unit isn't sold, the €1bn will be put into IL&P by the Government.