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Resolution rejects yet another Pearl bid

Pearl has made another approach to Resolution with a cash offer of 691 pence per share but has been knocked back again.

On October 10, Pearl Group announced the terms of a possible cash offer for Resolution at 660 pence in cash for each share which was later rejected by Resolution.

Today, Pearl has announced a cash offer at 691 pence plus the interim dividend of 9.17 pence payable to shareholders later this month, which values each share at a total of 700.17 pence but this too has been rejected by Resolution.

Resolution says that the offer significantly undervalues Resolution and its prospects as part of Friends Financial and therefore has rejected it.

It says the offer is at a 2.3 per cent discount to Resolution’s closing price at 18 October 2007 of 707 pence, ex-dividend.

Resolution says: “The offer takes no account of the value creation potential available to Resolution shareholders through their entitlement to a 50.9 per cent share of the value of Friends Financial, which comprises the combined embedded value, the value of the combined new business franchises, the value of the asset management businesses and merger synergies.”

Any further offers need to be made by October 25.

Resolution Chairman Clive Cowdery says: “All potential bidders are well aware we will only be diverted from the merger by a compelling offer for Resolution. This second offer from Pearl below our share price falls a long way short of the value of the merger.”



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