Merger talks between Inter-Alliance and Berkeley Berry Birch have broken down after BBB pulled the plug on four months of negotiations which failed to agree the structure and price of a deal.
BBB group chairman Cliff Lockyer, who would have gone from a controlling to a minority shareholder under the deal, says fluctuations in both firms' stock price have made pricing a deal difficult.
Product providers with stakes in both firms are understood to have blocked any deal that would have allowed cash to come out of the two businesses.
Both Lockyer and Inter-Alliance chairman Keith Carby have described the ending of negotiations as amicable and resulting from a failure to agree terms and not from a clash of personalities.
The proposed merger, which was first mooted in January, had been seen as a way for both firms to cut out considerable business costs.
Carby says: “The justification for the deal for both companies is as strong today as it was in January. We came very close and although we are disappointed that the merger has not been successful, we remain committed to consolidation.”
Lockyer says: “It is disappointing that the deal is off. Originally, I was optimistic but in the end we could not reach agreement on price and structure. There have been no fallings out, no difficulties. Who knows what will happen in the future.”
Scottish Widows intermediaries and partnership director Robert Wyllie says: “Both parties will probably go away from this reflecting on what might have been.
“We will never know whether this would have been a strong business in the sector – the other major players will have been watching this deal carefully. But the rationale for consolidation has not disappeared.”