Eureko Drops Bid For Equitable

Barely three weeks after it announced that it was interested in bidding for U.K. Mutual insurer Equitable Life, the Dutch-based Eureko Group has apparently withdrawn from the auction.

According to a report in the Times, Eureko had wanted to have exclusive negotiations with Equitable, but this would have excluded the only other potential bidder, the U.K.’s Prudential.

Eureko’s withdrawal leaves Prudential as the only bidder. Equitable, is obliged to sell due to an unfavorable court ruling, that reaffirmed its obligation to continue paying guaranteed annuities. The potential liabilities are estimated to be at least £1.5 billion ($2.2 billion) and possibly much more.

It’s the unknown size of the liabilities, which has apparently scared off all the potential buyers, except Prudential, but according to a comment in the Daily Telegraph, even it may be having second thoughts, despite the favorable terms it could impose as the only bidder. Equitable expects to announce the sale this month.