Lloyds quiet on Widows front

16 October 2006

Lloyds TSB has refused to comment on rumors that it has rejected an £8 billion approach for its Scottish Widows unit.

The high street bank is thought to have received a bid for life insurer Scottish Widows from insurers Axa and Swiss Re, but rejected the offer as Scottish Widows is experiencing an upturn in its fortunes.

The French and Swiss insurers teamed up to make a move for Scottish Widows, the UK's fifth largest insurer, last week, with Axa looking to secure the business, including its fund arm, and Swiss Re planning to take control of the closed life assurance funds.

A Lloyds spokesperson refused to answer questions about the rumored offer and added that the company remained "committed" to Scottish Widows.

Lloyds purchased Scottish Widows for £7 billion six years ago and the insurance unit paid £1 billion in dividends to Lloyds in 2005.

Shares in Lloyds TSB rose by almost four per cent following speculation about the joint bid on Friday. Scottish Widows has been the subject of a number of rumored unofficial approaches over the past few months.

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