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News > International
Axa to snap up SLP stake
May 2, 2000: 5:34 a.m. ET

French insurer agrees $3.6B purchase of Britain's Sun Life & Provincial
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LONDON (CNNfn) - Axa, the world's largest insurer, secured a recommendation Tuesday from the board of Britain's Sun Life & Provincial (SLP) for its £2.3 billion ($3.58 billion) offer to buy out minority shareholdings in the Axa-controlled company.

Axa is offering 500 pence a share for the 43.7 percent of SLP not in its control, a 54.1 percent premium on the stock's Mar. 23 close, a day before Axa first said it was in talks to increase its stake.

Sun Life (SLP) shares jumped 6.7 percent to 487 pence in morning trade in London.

graphicAxa had maintained a separate listing for SLP to provide an acquisition currency in the consolidating U.K. insurance sector. Axa used SLP stock valued at 500 pence a share to buy rival Guardian Royal Exchange last year, making it Britain's third-largest general insurer and the number four life and pensions provider.

However, SLP stock has dipped this year, underperforming its peers in the U.K. insurance industry by around 30 percent and giving Axa the opportunity to secure 100 percent ownership at a price below its main U.K. rivals. Axa plans to integrate SLP into its European operation.

Sun Life said Tuesday its new life insurance and pensions business fell 9 percent in the first quarter of the year from the same period in 1999.

The buyout of the minority shareholdings deal is subject to shareholder approval. The companies aim to close the transaction in July.

Axa (PXX) shares were 1.4 percent higher at 165.40 in Paris. Back to top

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