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Insetco abandons ARM takeover
Life settlements specialist Insetco has abandoned its bid to buy the struggling life settlements fund ARM Asset Backed Securities.
In a notice to the Luxembourg stock exchange, Insetco confirmed that the proposed acquisition had lapsed due to a failure to agree terms with ARM, the Luxembourg regulator CSSF and Ernst & Young, which was appointed supervisory commissioner to ARM in November.
Insetco had already admitted on November 24 that the deal was in jeopardy in spite of support from ARM investors because of delays to the negotiations with the CSSF.
Today (January 27) Insetco said that, although the negotiations had been extended, the proposed deal had now lapsed and Insetco was to resume trading on the Luxembourg stock exchange, having been suspended during the talks according to exchange rules.
The £114m ARM fund was distributed in the UK by Catalyst Investment Group, which was also set to be bought by Insetco as part of the deal.
In September the CSSF issued a statement accusing ARM of issuing bonds to investors for a period of two years in spite of not having the required permissions. It also continued to accept new investments in spite of warnings from the CSSF.
The regulator said it refused to grant ARM a licence to trade in Luxembourg because of the fund’s “inability and/or unwillingness to comply with prudential and legal requirements”.
To counter the claims, ARM has launched bid for a judicial review into the CSSF’s decision, as reported by Investment Adviser in December.
