LV= pours cold water on merger plans

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LV= has poured cold water on reports than it is seeking a merger with another provider.

Reports suggested last month that LV= had held talks with Royal London about a potential deal, but talks ended when the pair could not agree terms.

It was also suggested the LV=’s general insurance business had received a number of approaches from other insurers regarding a potential acquisition.

Speaking to Money Marketing after the release of LV=’s annual results this morning, managing director of protection Myles Rix said that the provider could not comment on past talks, but was not currently in merger discussions.

He added: “I don’t think we need to acquire assets in order to reach scale. We have a profitable business at the scale we are at. There’s not a need for us to consolidate more.”

“I don’t think we need to dash for growth in order to achieve scale.”

While LV= completed its acquisition of insurer Teachers Provident Society in June last year, Rix described this as a “relatively small transaction” for the group.

While LV=’s life and pensions arm increased its profits from £41m to £45m, the group as a whole reported a pre-tax loss of £49m in 2016.

Rix said that while the life and pensions business was growing, changes to discount rate rules had resulted in around a £100m reduction in overall profits.