December 2, 2014 / 6:34 PM / in 5 years

Friends Life founder to focus on U.S., Europe buys

LONDON (Reuters) - The founder of Britain’s Friends Life FLG.L hopes to make two acquisitions in the United States in the next year following the $8.8 billion sale of the insurer to rival Aviva (AV.L).

Clive Cowdery, who founded Friends Life in 2008, stepped down from the board in a restructuring earlier this year, though the Aviva sale will bring his investment vehicle Resolution 220 million pounds ($344 million).

Cowdery’s model involves buying up life insurance firms that are usually closed to new clients and merging them to make tax and operational savings. He said there were fewer opportunities left in Britain, since Resolution had bought 25 operating life insurance companies over the past 10 years.

“The last decade was consolidation, the next decade will be evolution,” he told Reuters in an interview.

Resolution Life, set up to invest in the United States, has raised $2 billion in capital and made one investment so far, in Allstate Life Insurance for $600 million.

Cowdery said a couple more U.S. deals were in the pipeline: “We are working on more than one deal. We are busy and active, we think 2015 will be a good year.”

Resolution Life would only go public in the United States when it had completed at least three transactions, he said.

The U.S. market offered many of the same attractions as Britain did in the past, Cowdery said, with a large number of over-capitalised life insurers that may be looking to sell parts of their business. A similar venture to invest in European closed life businesses would follow, he said in the interview.

Aviva and Friends Life agreed the takeover, which will make the combined group a market leader in insurance, in response to pressures caused by British pension reforms. [ID:nL6N0TM0TM]

Cowdery said Resolution would likely take its money from the Aviva deal in shares, rather than cash.

(1 US dollar = 0.6395 British pound)

Editing by David Clarke

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