Sale of Old Mutual’s US unit delayed

In a statement providing
minimal detail, UK insurer Old Mutual has announced that the sale
of its troublesome US unit OM Financial Life Insurance Company
(OMFLIC) to US private equity firm Harbinger Capital Partners has
been delayed.

The sale of OMFLIC to
Harbinger for $350m was announced in August 2010.

In the statement, the insurer
noted: “Old Mutual and Harbinger are continuing discussions with
state regulators to obtain the approvals that are required prior to
the consummation of the transaction.”

It added: “Old Mutual is
assisting Harbinger in exploring possible modifications to the
transaction structure from that envisaged in the sale agreement
announced on 6 August 2010.”

Comments in the hedge
fund-focused media suggest that the primary problem confronting the
deal is Harbinger’s difficulty in raising the required
finance.

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