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Clive Cowdrey spots a bargain

Annuity reform and an FCA probe have left shares in life assurer Resolution looking very cheap - a fact that doesn't seem to have escaped founder Clive Cowdrey
April 10, 2014

Clive Cowdrey, who originally founded Resolution (RSL) to buy underperforming life operations -and who will step down as a non-executive of the group at next month's AGM - isn’t slow to spot a bargain. He blew nearly £3.3m on 28 March, snapping up 1.2m Resolution shares at 274p each, having watched them slide by around 100p just 11 days earlier.

IC TIP: Buy at 289p

There’s no big mystery to that derating. Sentiment towards most life assurers took a big punch on budget day, when George Osborne announced the abolition of compulsory annuity purchases. Life assurers’ shares then took another tumble after regulators at the FCA announced a probe into closed-life funds, which initially prompted fears of another mis-selling scandal.

None of this is as grim as it seems. Sure, Resolution has a large back-book for the FCA to look at. But the regulator's clarifications over the nature of the planned investigation suggest an agenda focused on fair treatment rather that past sales practices; analysts think the sector will have little to worry about in that respect. And although scrapping compulsory annuity purchases won’t help Resolution to offset its maturing back-book, neither is it likely that the annuity market is dead.

Buys       
CompanyDirectorDateNo of sharesPrice (p)Value (£)Holding (shares)Holding (%)
Aviva Robert Stein31 Mar 1410,000479.447,94217,0000.001
Berkeley Group Holdings (The) GJ Fry27 Mar 141,2002,59131,0971,160,7460.858
Capita M Bolland (ch)01 Apr 148,0001,10388,24063,0000.010
Chesnara Graham Kettleborough (ce)28 Mar 146,900301.520,80475,0000.065
Frontier IP  Michael Bourne01 Apr 14175,0002849,000175,0000.777
Frontier IP  James Fish (fd & cs)01 Apr 14100,0002828,000100,0000.444
G4S John Connolly (ch)02 Apr 14100,000246.0246,022200,0000.013
Global Petroleum Peter Hill28 Mar 14530,0006.4634,238710,0000.356
IMI Mark Selway (ce)31 Mar 148,5281,465124,9358,5360.003
Intu Properties ♥John Whittaker28 Mar 1417,500310.854,390196,219,85815.671
Intu Properties ♥John Whittaker28 Mar 14200,000309.9619,750196,202,35815.670
Intu Properties ♥John Whittaker28 Mar 141,200,000308.53,702,438196,002,35815.654
ITE  Marco Sodi (ch)28 Mar 1425,000193.748,425100,0000.040
Just Retirement  Rodney Cook (ce)31 Mar 1450,00014170,5002,707,3740.541
Kennedy Ventures *Peter Redmond28 Mar 141,320,0001.2516,5001,320,0001.857
Kennedy Ventures *Colin Weinberg28 Mar 141,810,0001.2522,6251,960,0002.757
Kennedy Ventures *JN Harrison28 Mar 144,800,0001.2560,00012,400,00017.441
Kennedy Ventures *CG Clarke (ch)28 Mar 144,800,0001.2560,0004,800,0006.751
Kennedy Ventures *Chris Yates28 Mar 141,720,0001.2521,5001,810,5002.546
Kofax Chris Conway31 Mar 1410,00050250,200310,0000.337
Ladbrokes David Martin27 Mar 1430,000134.140,23030,0000.003
Northern Bear Graham Jennings27 Mar 1485,7143530,0001,254,0387.097
Optimal Payments Joel Leonoff (ce)01 Apr 1480,000373.9299,1004,053,8432.513
Pantheon Resources Jay Cheatham (ce)31 Mar 14125,00019.9124,8882,804,2492.747
Pantheon Resources John Walmsley (ch)01 Apr 1450,30119.8810,0001,109,9381.087
Pantheon Resources Justin Hondris (fd)31 Mar 1475,00019.914,925935,0000.916
Parity ♥ Paula Swinstead (ch)27 Mar 14108,74522.7524,73913,295,21513.118
Polar Capital Holdings MW Thomas28 Mar 144,000490.919,6354,0000.005
Premier Foods Gavin Darby (ce)31 Mar 1438,01466.7525,3741,029,0510.125
Prime People John Lewis 27 Mar 14109,00084.091,5931,008,5508.383
Redhall * Richard Shuttleworth (ce)27 Mar 14217,9483985,000267,9480.546
Resolution Clive Cowdery28 Mar 141,200,000273.73,284,1609,687,1840.683
SOCO International Rui de Sousa (ch)31 Mar 1450,000395197,5009,158,8202.760
SOCO International Rui de Sousa (ch)28 Mar 1450,000400200,0009,108,8202.745
Toumaz Antony Sethill (ce)01 Apr 141,500,0003.2348,3754,000,0000.244
Toumaz Dr Richard Steeves (ch)02 Apr 141,000,0003.8838,80019,750,0001.203
Toumaz Dr Richard Steeves (ch)02 Apr 1412,500,0003.05381,25018,750,0001.142
UNITE* MC Allan (ce)27 Mar 1412,19641050,004441,5930.220
UNITE*  A Jones27 Mar 1415,00041061,50015,0000.007
Vodafone Vittorio Colao (ce)28 Mar 144,012,115219.18,790,3439,077,3110.034
Vodafone  Nick Land27 Mar 1413,000219.528,52932,090<0.001
Vodafone  Andy Halford28 Mar 14977,673219.12,142,0332,304,9530.009
Vodafone  Stephen Pusey28 Mar 14730,623219.11,600,7581,579,5500.006
Xaar Ted Wiggans02 Apr 144,700903.342,4569,3340.012
ZincOx Resources*Andrew Woollett (ch)02 Apr 141,212,00010121,2005,387,5963.692

Sells       
CompanyDirectorDateNo of sharesPrice (p)Value (£)Holding (shares)Holding (%)
Countrywide Grenville Turner (ce)02 Apr 14682,000641.04,371,5521,951,3230.889
Countrywide Jim Clarke (cfo)02 Apr 14491,300641.03,149,1841,088,7580.496
Hargreaves Lansdown ♥M Evans (ch)27 Mar 147,5001,468110,1008,1250.002
Hill & Smith Holdings Derek Muir (ce)01 Apr 1411,62154363,102146,6050.188
Redcentric Ian Smith01 Apr 14600,000110660,0009,649,1086.705
Redcentric ♥Ian Smith01 Apr 143,900,0001104,290,0005,874,1084.082
Signet Jewelers Michael Barnes (ce)27 Mar 1433,9966,2882,137,558240,9820.300
TT electronics Shatish Dasani (fd)31 Mar 14150,000213319,500529,1440.334
TT electronics Shatish Dasani (fd)27 Mar 14150,000215322,500679,1440.428
Wood Group (John) ♥Allister Langlands (ch)31 Mar 145,00077438,700426,2140.114
Wood Group (John) ♥Allister Langlands (ch)31 Mar 145,00077438,700431,2140.115

* placing/tender/open offer ♥ spouse/connected party