Deutsche Bank joins GE Life race

1 September 2006

Deutsche Bank has become the latest big name financial institution to enter the bidding race for UK-based life insurance firm GE Life - the insurance arm of General Electric.

According to the Daily Telegraph, the German bank is already in the running for the insurer, competing with Swiss Re and the Bermuda-based reinsurer XL Capital to secure a deal.

The battle is expected to be a close one, with all three bids though to be evenly matched at between £350 million and £380 million, although no official figures have been released.

The newspaper suggests that if Deutsche Bank succeeds in making the acquisition, it will attempt to unlock the value of the company through financial engineering - including the securitizing of assets and refinancing the business using derivatives.

Another possibility is the break-up of the company, which could see Deutsche Bank hold on to closed life funds while getting rid of the specialist retirement plans that could more easily be sold.

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