Deal may force merger of RebusIS and Xchanging
Sherwood International is facing a merger with SunGard in a major consolidation for the insurance IT industry.
The two companies are understood to have closed a deal after protracted attempts to find a fit for the company.
SunGard, the US financial software giant that last year bought Guardian IT for £56m, has been examining Sherwood for about a month. It was expected to announce a formal bid just after Insurance Times went to press.
Sherwood's chief marketing officer Martyn Lambert said a review of options to develop the company rapidly concluded that a sale or management buy-out were the most promising.
Sherwood's share price has been holding at 129p after gaining on the back of expectations that SunGard's offer would come in between 140p and 150p a share.
The deal is expected to end a process begun in April when Sherwood's board put the company on the market.
Sources suggested that a sale to SunGard emerged after the collapse of attempts to merge Sherwood with RebusIS after Sherwood's stock price fell sharply last year.
This deal is understood to have split RebusIS' venture capital owners General Atlantic and Warburg Pincus after the latter opposed the merger. There was speculation that General Atlantic would now attempt to merge RebusIS with Xchanging, the processing operation whose ownership it shares with Lloyd's and the London Underwriting Association.
