Friends rejects new Flowers offer

Life assurer Friends Provident today said it had rejected a revised £3.5bn (€4.4bn) offer from private equity firm JC Flowers.

Friends said the proposal, worth 150p-a-share, “significantly undervalues” the company and represented no “basis for discussion”.

The offer is less than the 175p-a-share New York-based Flowers was reportedly looking at paying in January.

Friends added that the private equity firm’s renewed proposal indicated the offer price would be reduced if the life group paid the 2007 final dividend of 5.3p.

“The board of Friends Provident informed JC Flowers & Co that its proposal significantly undervalues Friends Provident and its prospects and does not represent a basis for discussion,” the group said in a statement.

Friends has seen its share price tumble in recent months after the collapse of a merger with closed life fund manager Resolution, a deal which was gatecrashed by rival suitor Pearl.