Aviva and Friends Life blockbuster merger plan: The fund manager verdict

The insurance sector has come under the spotlight this week after Friday's revelation Aviva was seeking a merger with Friends Life in a deal worth £5.6bn.

The proposed merger would create the "UK's leading insurance, savings and asset management business". Stephen Bailey, co-manager of the £545m Liontrust Macro Equity Income fund, said the merger could produce a rival to Standard Life. "Through this agreed all-share deal, Aviva should be able to achieve scale in the corporate pension market, an area in which Standard Life has so far been the standard bearer." Eric Moore, manager of the £219m Miton Income fund, holds exposure to Friends Life in his fund and said he expects there could be a counter-offer. "It is gratifying to see th...