Pearl Group Plans To Restructure, Seek Market Listing Print E-mail

LONDON (Dow Jones) – 14 April 2009

U.K. life assurance company Pearl Group Ltd. on Wednesday said it aims to raise GBP500 million in fresh funds and seek a public listing in a restructuring plan aimed at shifting it away from its debt-funded model and to pursue further acquisitions.

Pearl said it is in advanced talks to raise the new equity with investors and to restructure its capital with its lenders.

"We are in a market full of opportunities, but one in which the debt-funded acquisition model that served Pearl and others so well in the past is simply no longer appropriate," the company said.

Pearl's stock market flotation would likely take place at the end of the third quarter or beginning of the fourth quarter of 2009, according to a person familiar with the situation.

Last month Pearl decided to defer GBP33 million in coupon payments on bonds it acquired as part of its GBP5 billion purchase of the U.K. restructuring business Resolution PLC.

The company said Wednesday that the restructuring won't affect its plan to possibly buy back the bonds at close to their last traded price of 12.5 pence each. It said also that the capital raising wouldn't necessarily improve the financial position of Pearl Group Holding Number One - which is the renamed Resolution business and houses the bonds. It said the coupon payments on the bonds could therefore remain frozen.

"The decision whether or not any future coupon payment is to be paid or deferred will be determined by the board of (Pearl) solely in the light of its financial circumstances at the relevant time," the company said.

Pearl Group, which traces its roots back to 1857, is backed by two investment organization, Sun Capital Partners Inc. and TDR Capital LLP.

The Financial Times reported Wednesday that Pearl is targeting a market capitalization of about GBP2 billion. A Pearl spokesman declined to comment.

U.K. entrepreneur Clive Cowdery, who sold Resolution PLC to Pearl, now owns Resolution Ltd. The company plans to deploy more than GBP5 billion to use for restructuring financial services firms in the U.K. and Europe.

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