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Lloyds buys 1st-The Exchange

Lloyds TSB Development Capital has bought a majority stake in 1st-The Exchange in a £115m deal.

This week’s Money Marketing reports that the private equity arm of Lloyds Banking Group has invested £42m for a majority stake in the firm. Vertex will retain a significant share in the business.

Managing director David Child will continue to lead the team alongside strategy and business development director Paul Yates and finance and operations director Kevin Budge. Sesame Group executive chairman Ivan Martin and former Friends Provident chief executive Ben Gunn are app­ointed non-executive directors while ex-Thomson Financial Europe managing director Alastair Hazell will be chairman.

1st-The Exchange says the deal is the biggest UK institutional buyout by private equity this year.

Child says: “We now have an incredibly strong investment foundation to support and accelerate our future plans.”

LDC director Daniel Sasaki says: “By combining our specialist experience with the existing proposition, we can help to support the growth of 1st-The Exchange.”

In May 2005, Vertex bought The Exchange’s parent company Marlborough Stirling for £95.3m. In February 2006, Vertex acquired back-office software provider 1st for £25m plus up to £13.5m depending on performance. In January 2007, Vertex was sold to a consortium of American private equity firms for £217.5m. Earlier this month, Vertex appointed IBM Financial Services global managing director Paul Sweeny as its new chief executive.

LDC has recently completed a management buyout of JP Morgan Invest, the flexible savings platform and wealth advice service for employees.

Finance and Technology Research Centre director Ian McKenna says: “This move can be nothing but a good thing for The Exchange and 1st.

“Having had to serve a succession of different owners over the last five years must inevitably have been a major distraction for the management who can now entirely focus their energies on delivering the products and services that the industry needs.”


Orphan vote deadline extended

Aviva has extended the deadline for its ballot on the reattribution of its inherited estate by a month to September 21. In May, Aviva and policyholder advocate Clare Spottiswoode renegotiated a deal for the inherited estate which would see payments to policyholders slashed in half.


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