Reported bid is a tenth of Co-op’s original £600m asking price
Goldman Sachs has been called in to prepare an offer of about £60m for Co-op insurance, according to reports.
L&G has joined forces with Catalina Holdings, a specialist consolidation vehicle, with a view to splitting the Co-op insurance business between its back book and ongoing policies, Sky News reports.
The recent moves are some way off the original expectation. Co-op original wanted to sell the whole business for £600m.
The Co-op originally asked for such a high price because it planned to buy Lloyd’s 632 bank branches.
The idea was to offer the new acquirer of its insurance arm the big bonus of selling policies through the branches.
But that Lloyd’s deal never materialised and since then, the situation has gone from bad to worse.
A £1.5bn capital hole means Co-op is being forced into a fire sale of its insurance arm. The reputation of the business is also damaged following revelations of the drug-taking ex-chairman Paul Flowers.