Pearl lines up Harvey for chairman's job

Pearl, the insurer, is believed to have set its sights on Richard Harvey, formerly chief executive at Aviva, as its new chairman.

Mr Harvey is thought to have been approached by headhunters appointed by Pearl earlier in the summer, with the former Aviva boss leading a shortlist of candidates for the chairmanship of the insurance firm.

"Richard Harvey is the heavyweight candidate with the right experience to help Pearl in this market," said a source. "He is the right candidate to help Pearl take on Clive Cowdery, as the life insurance sector consolidates. Rest assured, Cowdery won't get things his own way."

Mr Harvey, who surprised the City by quitting as chief executive of Aviva in 2007 when he was just 57, is thought to be interested in the Pearl role, but is weighing up a number of other opportunities. After leaving Norwich Union, Mr Harvey worked for an African charity.

Pearl is looking to be listed on the stock market by the end of the year, after being bailed out through a debt-restructuring agreement struck with its banks in June.

A consortium of 17 banks now owns 10 per cent of Pearl, following the agreed debt-for-equity swap, while Pearl founder, pizza entrepreneur Hugh Osmond, through his investment vehicle, Sun Capital, and the private equity firm TDR Capital, retain a 30 per cent stake.

Mr Osmond, who is thought to have been granted generous warrants by the banks to turn the company around, is expected to become non-executive vice-chairman of the new listed group.

Liberty Acquisition Holdings, an Amsterdam-listed company controlled by the American hedge fund billionaire Nicolas Berggruen, also ploughed £500m into Pearl, and now owns a majority 60 per cent stake in the company.

When Pearl lists, it is expected to duel with Mr Cowdery's Resolution group, which finally succeeded last week in its attempts to buy the insurer Friends Provident in a £1.9bn paper-and-cash deal.

Mr Cowdery bought Friends for 79.4p a share, a premium to the insurer's recent share price, but dramatically less than the 225p at which Friends floated in 2001.

Like Pearl, Resolution has sought to bolster its board with high-profile names, with the former Financial Services Authority chief executive, John Tiner, among its number.

"There is clearly no love lost between Cowdery and Osmond, so it will be interesting to watch them cross swords once again," said one City analyst.

The pair have a long history of enmity, fighting over Henderson's closed life insurance books in 2005, while Pearl bought Cowdery's Resolution at the end of 2007, a deal that netted Cowdery a personal windfall of £145m. Reports suggested that the deal personally cost Mr Osmond up to £200m as markets soured and the assets he purchased struggled.

If Pearl succeeds in securing the services of Mr Harvey, it will have pulled off a coup by snaring one of the life-insurance sector's most experienced individuals.

Mr Harvey began his long career at Aviva in 1992, becoming head of its New Zealand operations before returning to work for the company in the UK in 1993.

He was Norwich Union's finance director when the group demutualised and floated in 1997. He became the company's chief executive in 1998.

Mr Harvey also masterminded what was Aviva's ultimately unsuccessful attempt at the takeover of rival Prudential in 2006.

Prudential is now chaired by Tidjane Thiam, the former chief executive of Aviva's international operations. Prudential increased its dividend payout to shareholders last week, bucking the trend set by the rest of the sector.