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FI&S takes over Friends&#39 funds

Friends Provident is to sell its retail fund management arm to Friends Ivory & Sime and is mailing its 1.7 million customers to confirm the details as it gears up for demutualisation.

The company, which owns 63 per cent of FI&S, will sell its unit trust business in return for shares in the listed fund manager. The deal will increase its stake to 67 per cent of FI&S.

FI&S will take responsibility for the marketing and development of £2.8bn in Friends Provident funds, which it already manages, and will see the funds more widely marketed to the independent adviser market.

The funds will remain under the Friends&#39 brand for the immediate future.

FI&S chief executive Howard Carter says: “Our strategy is to create a major retail and institutional investment business. This transaction moves us towards our goal by giving Friends Ivory & Sime a base for developing a major presence in the UK retail investment market.”

Friends Provident is mailing its customers this week to verify personal and policy details in preparation for demutualisation.

The company says it wants to ensure that benefit entitlements from the flotation are not delayed.

Members living in the UK will get free shares, while those outside the UK will have their shares sold and the proceeds forwarded to them. There will also be a preferential deal for members requesting additional shares.

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