Royal Liver has pulled out of the proposed merger with fellow mutual Royal London.
In a joint statement last week, the companies said Royal Liver’s board had decided members would be better served by it remaining independent.
The board’s decision to reject the proposals at this stage means they will not be presented to Royal Liver’s 220 delegates, who are voted for by policyholders and would have taken the final decision.
Royal London says it is disappointed but relations between the mutuals remain strong.
Much of the speculation over why the deal broke down has focused on issues around with-profits but neither company would comment on Royal Liver’s decision.
The statement says: “After careful thought and thorough consideration, the board of Royal Liver has concluded that although the proposal from Royal London had considerable merits for members, those interests will be better served by pursuing an independent strategy.”
Bright Grey communications director Susan Sneddon says: “It is disappointing the conversations have ended but we have to respect Royal Liver’s decision. Discussions were ongoing so there was still a lot to talk about. Discussing the protection companies was not a step we had got to yet.”
Direct Life and Pensions sales and marketing director Richard Verdin says: “These things either work or do not work for reasons we can only speculate on but it does go against the current trend for mergers and acquisition.”
Royal London, which comprises Royal London Asset Management, Bright Grey and Scottish Life, and Royal Liver, which owns Progress, Caledonian Life and Park Row, announced their merger talks in April this year.