Kent Reliance Dangles Demutualisation Carrot
Building society changes policy to welcome 'carpetbaggers'
23rd May 2006
Kent Reliance, the country's fastest growing building society over the last five years, has scrapped a rule first introduced to discourage so-called carpetbaggers, or investors opening an account solely to benefit from any possible demutualisation windfall.
The rule, introduced five years ago, stipulated that any windfall gained during the first five years of an accountholder's membership must be donated to charity, and was intended to stop the 'disruptive' effect of speculative investors.
The building society says that it would not now be harmed by people opening accounts purely in the hope of demutualisation, and so the rule will be scrapped as of June 1st.
Many analysts are taking the move as a sign that Kent Reliance are considering a flotation or merger with another society, and this was not ruled out by the KR's CEO, Mike Lazenby, who said that it was not likely to happen 'next week or next year', but was a possibility at some stage in the future.
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More on Demutualisation : Standard Life Shares Rise on Day One (News, 11/07/2006), Cut in Standard Life Flotation Windfalls? (News, 12/06/2006), 98% 'Yes' by Standard Life Members (News, 03/06/2006), 500,000 Standard Life Policyholders Still 'Missing' (News, 22/05/2006), Standard Life Calls for Members to Make Contact (News, 24/04/2006), See all 10 Demutualisation stories >>> |
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