Outlook: Axa/GRE

WHEN THIS column wrote a week and a bit ago that it was doubtful Guardian Royal Exchange would remain independent long enough for the new heir apparent, Peter Owen, to take the chief executive's job, it was not writing with the benefit of insider knowledge. As it is, events have closed in with a speed few could have predicted. Axa, through its UK offshoot Sun Life & Provincial, has made what the board considers to be a serious approach.

This doesn't necessarily mean the company is up for sale. Everything John Robins, the present chief executive, has done over the past three years has been designed to secure a viable, independent future for GRE. The recent appointment of Morgan Stanley was not made with the intention of conducting an auction, but with that of bolstering the company's defenses.

However, now that Axa has shown its hand, if not yet gone public, it's plainly in GRE's interests to excite potential rivals. The problem with such an approach is that it can get out of hand. An auction may not have been GRE's intention, but it could be that this is its fate.