Tower Financial Services has confirmed speculation that it is going ahead with plans to demutualise and list on the Australian and New Zealand sharemarkets.
Under the proposed scheme, which will require High Court sanction, Tower's 400,000 members will exchange their membership rights for shares in the new listed company.
Tower chairman Colin Beyer says the company has been working on the demutualisation proposal for 10 months.
He says demutualisation will have the twin effects of releasing significant value within the group, and providing additional capital for continued expansion.
"The recent successful listing of a number of insurance and investment groups has been noted with interest by Tower's board. We believe that Tower shares will be well received by markets given our strong performance in the 90s," he says.
The demutualisation process is expected to take upwards of six months and specific details of the scheme will be available during this period.
The cut off date for members to be eligible to participate in the scheme is 9pm, Monday December 8. Members must maintain their policies through to the qualifying date, set close to the time of demutualisation, in order to remain eligible for share allocation.
Tower's announcement comes at a time when Guinness Peat Group (GPG) tries to demutualise Tower by merging it with its listed life insurance subsidiary Tyndall Australia.
GPG hasn't publicly released any details of its plans, but had been intending to brief Tower's 120 agents on the proposal this week.
Those meetings were postponed when rumours began circulating that Tower was about to announce demutualisation plans.
Tower Financial Services has confirmed speculation that it is going ahead with plans to demutualise and list on the Australian and New Zealand sharemarkets.