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NU, Friends and Widows in £26m Assureweb stake

Norwich Union, Friends Provident and Scottish Widows are taking a 40 per cent stake in Misys-owned Assuresoft to inject £26m into its Assure-web IFA portal.

Misys says the cash boost is the only way it can achieve an effective end-to-end proposition for online trading and servicing. But the deal has sparked fears that the firms could get preferential treatment on the portal although Misys denies this.

It also refutes suggestions the deal favours a multi-tie scenario, arguing the savings will benefit all life companies whatever the outcome of the polarisation review.

Misys will retain operational control of Assuresoft, with one of the three providers getting a non-executive seat on the board.

The deal allows for a further three providers to buy a share in the 40 per cent equity stake, which could lead to a bidding battle between providers.

Providers are paying £9.2m for the equity stakes, with Norwich Union getting 18 per cent and Scottish Widows and Friends Provident both taking 11 per cent. The three will pay a further £16.8m in fees for use of the portal until 2005.

Misys Financial Services Division chief executive officer Ivan Martin says: “IFAs will not shy away from the portal because providers have a stake in it. They will use it for its simplicity and ease of use.”

Financial Services Research Centre director Ian McKenna says: “Providers will be worried about being left out as they battle for a slice of portal pie. This will create further tension.”

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