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Lane Clark parent gets private equity approach

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UK – Alexander Forbes, the South African-based parent company of UK actuaries Lane Clark & Peacock, is in talks with private equity investors about a sale of the entire group.

The approach comes coincides with a top management change at Alexander Forbes and a probe into its business practices.

“The group has commenced discussions with private equity parties regarding a potential transaction to acquire 100% of the group,” Alexander Forbes said. The discussions – which follow the receipt earlier this month of various approaches – “are at an early stage and may or may not result in a transaction”.

A spokesman declined to provide further details but said the talks would have “no impact” on LCP. “No businesses are for sale,” he added.

“It doesn’t really affect us at all,” LCP partner Jeremy Dell told IPE. He said the firm is run as a separate company within Alexander Forbes. “It’s business as usual.” Alexander Forbes has 60% of the firm, with the partners holding 40%.

Alexander Forbes’ 2005 earnings report yesterday said LCP, which was bought in 2002, had “exceptional growth in revenue and profits” in 2005 - although there were no more detailed figures.

Group chief executive Rael Gordon is to be succeeded by Africa managing director Peter Moyo from July 1.

The change comes as the group is also reviewing certain “historical business practices” – bulking retirement funds’ banking accounts – which will result in a total of R480m in client payouts.

“This has been one of the most difficult periods in Alexander Forbes’ 70-year history with significant issues raised concerning the historic transparency of income earning by out South African Financial Services business,” the firm said.

“We failed to live up to our history of dedicated client service in this area of our business, which we sincerely regret.”

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