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Big win for Standard in float vote

Magic million’ in sight after late surge of postal votes

Europe’s biggest mutual Standard Life is poised to become a plc with an overwhelming mandate of more than 75 per cent of its voting members, Money Marketing understands.

A late surge of postal votes boosted support for the move.

Standard Life group chief executive Sandy Crombie is on track to get a “magic million” votes for demutualisation.

A flotation is expected to create a huge FTSE 100 plc, with IFAs braced to see how the firm will approach distribution.

It pledged last year to concentrate on profitable lines of business as with-profits business has slumped.

Clients holding with-profits bonds and homeplans are set to receive an extra bonus with an unexpected, if modest, boost to plan values. The maximum increase is around 4 per cent, depending on history of premiums and withdrawals, but most members who hold these plans will be entitled to a higher windfall share allocation.

Standard this week confirmed a total of 30m new insurance business worldwide for the first quarter of this year compared with 33m for the whole of 2005.

Kohn Cougar IFA principal Roddy Kohn argues that the turn-round in business means that policyholders would be better off as members rather than shareholders.

Save Our Building Societies campaign co-ordinator Bob Goodall has pledged to challenge demutualisation in the Scottish courts, which have to give approval for a change.

Goodall says: “If Standard Life demutualises, it will represent a board of directors using their position, the huge resources at their disposal and the trust placed in them to take what is not theirs.”

Anand Associates financial architect James Brooke says: “We have been led to believe by Standard Life that there have been a number of talks with businesses willing to buy them but what has been the nature and value of these offers? One has to ask questions why we have not been told. I would also ask that if the business has been turned around in terms of profit, why would you give it away now?”

Standard Life group head of media relations Scott White refuses to comment.

The result will be announced this week at a special general meeting in Edinburgh.

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