Tyndall throws in Tower appeal towel

By Richard Braddell

WELLINGTON - The last impediment to Tower Corporation converting to a publicly listed company has gone after Tyndall Australia yesterday threw in the towel on its Privy Council appeal aimed at blocking the demutualisation.

The backdown brings to a close a chapter in what may the be the world's most hotly contested demutualisation which began when Tyndall's parent, Guinness Peat Group, proposed a Tyndall-Tower marriage as an alternative to Tower's own plans to demutualise under its own steam.

But a backdown by Tyndall, which took over GPG's litigation, seemed inevitable after another bid for 100 per cent of Tyndall by Royal & SunAlliance went unconditional last week. RSA took over the right to pursue the suit, but the fact Tyndall had failed in the High Court and Court of Appeal proved to a be a disincentive to take it further.

Although the High Court's final confirmation of Tower's demutualisation scheme is not set to be heard until June 16, the way looks clear after more than 99 per cent of members this week resoundingly approved the most litigated scheme yet put in a demutualisation.

In addition to clearing up anomalies in its structure, the demutualisation will give Tower access to equity capital for future expansion that was previously provided solely by a dwindling group of parent company policyholders.

New capital to be raised by Tower during the demutualisation will help with its own $A200 million bid for Australia's FAI Life which also went unconditional after acceptances in excess of 80 per cent.