Axa plans merger

Claude Bebear, chairman of French insurance giant Axa, is set to reveal merger plans for Equity & Law and Sun Life & Provincial Holding (SLP), Axa's two British subsidiaries, in the next three weeks, according to a source close to the company.

After its recent merger with French rival UAP, Axa, already the owner of all of Equity & Law, now also has 60 per cent of SLP. The minority shareholders are now concerned about how Mr Bebear will treat them.

"British institutional shareholders have a certain amount of distrust of French treatment of minority shareholders," said Neil Cumming, who manages UK equities at Prolific, the unit trust group that holds just over 1 per cent of SLP.

SLP has a 12-person board dominated by five company executives and three directors from UAP.

The remaining four independent non-executive directors include new arrival Sir Christopher Mallaby, until last year the British Ambassador in Paris, the former Grand Met director David Nash, Robert Barkshire and chairman Lord Douro.

According to UBS, SLP's broker, minority shareholders have nothing to fear since any deal is likely to require their voting support. The Prudential, itself touted as a possible buyer of SLP, has nearly 10 per cent of SLP, a quarter of the minority shareholding. Since Axa would be on both sides of any deal, it would not be able to vote its 60 per cent stake.