Provident gets management makeover ahead of sale

Provident Insurance’s US parent company GMAC has overhauled the management at the Halifax-based insurer in preparation for the sale.

Provident group chief executive Tim Heavisides has moved aside, but will remain with GMAC Insurance as chief executive of its other UK motor businesses, Car Care Plan and Motors Insurance Company, which are not up for sale.

Provident managing director James Reader has been handed full control of Provident, and will work with corporate adviser Goldman Sachs, which has now set a timetable for the deal to be completed.

Markerstudy has lodged its interest in Provident with Goldman Sachs. Group underwriting director Gary Humphreys said the board was now considering whether to submit an offer. It acquired rival motor insurer Zenith Insurance at the end of last year.

IAG UK chief executive Neil Utley is a keen admirer of Provident and is thought to be interested. Aviva has also been linked as a possible suitor in a move to ramp up its personal lines broker business, but a spokesman said it could not comment on speculation. According to well-placed sources, a management buy-out is still an option at this stage.

Reader has been managing director under Heavisides since 2008. He is now reporting directly to GMAC Insurance executive vice-president, Ron Judd.

A GMAC spokesman said that Car Care Plan and Motors Insurance Company remained “strategically important” and that Heavisides is now “devoting all of his efforts” to the two businesses, in light of the intended sale of Provident, which was bought by GMAC in 2007 for £170m. Heavisides has been chief executive of Car Care Plan since 2002 and was promoted to a wider group role to help develop Provident less than two years ago.

The move follows GMAC’s decision to appoint a new chief financial officer for Provident at the end of last year. Christian Plumer was brought into the role from a similar position elsewhere in the group, replacing Simon Wright, who also moved to Car Care Plan.