It had previously set aside just pounds 250m
Posted in General on 14. Aug, 2010
It had previously set aside just pounds 250m.In contrast to a Prudential decision to make policyholders pay 90 per cent of the compensation costs with shareholders paying only 10 per cent, United’s shareholders will bear 80 per cent of the costs.The announcement came as United struggled to appease shareholders, who have been frustrated by delays in getting DTI approval to restructure the group. It announced it had finally got approval for shareholders to reap most of the pounds 37m cost savings flowing from last October’s merger.The directors have also bowed to pressure from the market to ditch a loss-making direct-selling vehicle, United Friendly Financial Planning This was sold to Friends Provident for a loss of pounds 2m. Directors blamed delays on difficulties obtaining information from both occupational schemes and its own clients.
Group chief executive George Mack denied that the company had failed properly to estimate its own liability in the past.He said the extra money was needed to meet liabilities in full in the wake of a tougher attitude on mis-selling from the Treasury. The company said trading for the current year is in line with the board’s expectations.. United Assurance, the life assurance group formed last year from the merger of Refuge Assurance and United Friendly, yesterday more than doubled the amount it is setting aside to pay compensation to investors who were mis-sold personal pensions to pounds 150m Andrew Verity reports on the embarrassing admission. United Assurance warned that it may not be able to meet strict deadlines set by the Treasury for compensation victims of the pension mis-selling scandal.
Credit Lyonnais Laing, as agent for the company, has conditionally agreed to place 50 per cent of the new ordinary shares with institutional and other investors subject to the rights of qualifying shareholders to apply for new ordinary
shares under the open offer. The company said it will spend the pounds 12m on developing its UK natural gas business. International Energy made a half-year pre-tax profit of pounds 5.177m against pounds 3.843m last time and announced a placing and one -for-four open offer to raise pounds 12.38m. The company grew its earnings per share to 7.68p from 5.61p and its dividend to 1.20p from 1.16p.
“No matter which way they play it, they will have to pay $450m plus expenses.”Comment, page 25. Of these, about 60 will be eligible for a scheme under which they can receive up to two times their salary in shares provided Concert meets certain performance targets judged against other international telecoms companies.All 200 would be eligible for a deferred bonus plan under which Concert will top up annual bonuses by a third provided they are taken in shares, not cash.Additionally, Sir Peter would participate in a scheme entitling him to share options worth four times salary.BT sources yesterday disputed WorldCom’s claim that MCI would not have to pay a $450m penalty if its shareholders rejected the merger with BT. The various schemes could be worth as much as pounds 3m to Sir Peter, who would become chief executive of the combined business.About 200 BT executives will participate in the Concert global equity incentive portfolio, as it is known. “In merger terms this deal adds nothing at all to our European business,” he said.It emerged that if the merger with MCI fails to take place, then a group of senior BT executives, led by Sir Peter, stand to lose out on incentive packages worth tens of millions of pounds.Sir Peter is due a pounds 500,000 one-off bonus if the deal is completed and will also be the biggest benefactor from a series of share bonus schemes that the merged company, Concert, would put in place. That seems obvious,” said a spokesman for Karel van Miert, the competition commissioner.Mr Williams said WorldCom’s sales in Europe would be $600m this year, but added that MCI had no European business at all. However, WorldCom shares firmed $1.75 to $38 on Wall Street yesterday, indicating growing support among the US investment community for the bid.WorldCom again raised the prospect of discussions with BT if the rival merger plan went through. He deserves it.”BT shares rose a further 17.5p to 459.5p, as speculators who had piled into MCI shares in the US switched into BT stock.The European Commission meanwhile said WorldCom’s $30bn offer would be investigated under its merger rules.”It’s not been notified to us yet but at first glimpse it ought to be investigated.
It would leave BT with a 10 per cent stake in MCI-WorldCom.Colin Williams, president of international operations, said: “They’re welcome to remain a shareholder and they’re welcome to see how we’d jointly address the world environment The door is open. Whether BT walks through it is another question.”Sir Peter Bonfield, BT chief executive, and its new managing director, Bill Cockburn, were in Brighton last night meeting the Prime Minister Tony Blair.BT said Sir Peter would then be starting a pre-planned holiday abroad “He’s due a holiday and he’ll be taking it. Until WorldCom and MCI have spoken there isn’t much we can do about it.”BT highlighted the difference between its bid, which includes $4bn in cash, and WorldCom’s $41.50 a share all-paper offer. “We have a deal on the table which is signed, sealed and will soon be delivered It is in shares and cash WorldCom are offering paper,” said the spokesman. Senior executives at BT were said to be waiting for the outcome of an MCI board meeting, likely to take place as early as today.Industry analysts raised the prospect that BT might accept the offer of three-way discussions from Bernard Ebbers, WorldCom’s chairman But a BT spokesman emphatically ruled out the move “This is a matter for MCI. Last December the WorldCom president was given first billing at an industry conference chaired by Mr Grubman, who opened the proceedings by congratulating Mr Ebbers on his “vision and boldness”.. British Telecom yesterday rejected the offer of talks from WorldCom, which has launched a $30bn rival takeover bid for MCI, BT’s US partner.
It also emerged that BT executives will forfeit tens of millions of pounds in bonuses if the UK group’s lower takeover bid for MCI fails. Chris Godsmark, Business Correspondent, and Michael Harrison report.
BT was last night refusing to admit defeat after it found its pounds 13bn bid for MCI gazumped by WorldCom just weeks before the merger was to be completed. “We don’t disclose this and we’re not required to,” he said last night.One City trader said: “It’s unlikely they would have totally unwound the whole position. If they’d stuck with MCI shares then Salomon’s would probably have made back most of what they’d lost.”Salomon also came under scrutiny following the shock profits warning issued by MCI in July. Jack Grubman, Salomon’s New York based telecoms analyst, urged that the two companies keep the deal together, telling investors in a note that there was “no deal risk whatsoever.”Mr Grubman and Mr Ebbers have also had a close working relationship for many years. The vast power of the president severely limits the role of the opposition between elections, condemning them to a life of dreaming wistfully about their next trip to the ballot box.With three years left to the next election, two of his opponents – ex- general Alexander Lebed, and the liberal Grigory Yavlinksy – have already declared their candidacy.