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BT looks at buys to build up hub

BT is eyeing up acquisition targets including Origo, Assure-web and parts of Vertex and Capita, with a potential war chest of £250m to spend.

Last week, Money Marketing revealed that BT is planning to set up an insurance hub in an attempt to overhaul the industry’s communications infrastructure.

Documents seen by Money Marketing show that BT is investigating the acquisition of a major technology or outsourcing firm to cement this move into the adviser market.

Those on BT’s potential shopping list include standards body Origo, adviser portal Assureweb and parts of outsourcing giants Vertex and Capita.

The documents suggest that BT is willing to spend up to £250m, with acquisitions, partnerships and the option of building a system from scratch all being investigated.

Origo and Assureweb are both owned by groups of providers. Capita owns adviser portal Webline, back-office system provider Quay and research firm Synaptic.

Vertex, which was bought in January 2007 for £217.5m by American private equity firms, owns The Exchange and 1st.

Another option being investigated by BT is piggybacking its hub on to an existing wrap provider.

Ernst & Young head of insurance sector Shaun Crawford says: “Success will be dependent on acquiring key players in the value chain, including those who control desktops, and finding a space in the growing wrap market.

“It will take a big player with a big sum of money who understands technology and connectivity to make it work.”

A BT spokesperson says: “BT has a strong footprint within the insurance industry and existing relationships with many providers.

“BT cannot comment about new propositions or market initiatives. As the insurance market continues to evolve, BT is constantly looking for ways to meet market demand.”

An Assureweb spokesman says the portal would be interested in partnering with BT but would not comment on a possible acquisition.

Webline, Vertex and Origo would not comment.

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