Under the proposed offer, the price would be paid 40% in cash, and 60% in Old Mutual shares. In a statement, Old Mutual said it was now mulling “selected modifications” to the proposal in order to address concerns raised by the Skandia board.
The company said it remained keen to get the backing of the Skandia board, but added that it believed a majority of Skandia’s shareholders would welcome a firm offer at that price.
Skandia today said discussions with Old Mutual are continuing, although it has yet to receive a formal bid.
“Discussions with Old Mutual are continuing. If and when a formal offer is presented, the board will evaluate this offer. A further announcement will be made when necessary,” said Skandia.
Old Mutual shares closed at 136 pence in London on Friday, the last day’s trading before the UK bank holiday weekend. Skandia shares closed at 41.30 kronor on Monday.
According to a report in the Financial Times, some members of the Skandia board are holding out for a higher price, while others want to keep the company independent.
The Guardian reported that Skandia wants Old Mutual to raise the cash element of its offer, and also wants some Skandia board members installed on the Old Mutual board.
Old Mutual, which is listed in London but generates nearly half of its earnings in its historical home of South Africa, announced in May that it was in talks to acquire Skandia as part of a long-standing strategy of building a diversified international business.