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GPG agrees to sell Tower Australia stake to Dai-ichi Mutual

Friday 8th August 2008

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The 100.3 million shares will be sold in three tranches, with about half the stake subject to approval by Australian regulators and Tower investors. The sale price of A$3.75 a share, is a 34% premium to the stock price yesterday.

Proceeds from the sale will be used to help fund GPG's investments, it said in a statement.

Shares of Tower Australia, which was split off from the New Zealand business in a restructuring driven by GPG, have handed investors a return of 18% in the past year. They traded yesterday at A$2.79.

Dai-ichi, one of the world's 10 largest life insurers by premium income, agreed to begin a business cooperation deal with Tower if it succeeds in gaining all of GPG's shares. The deal would mark its entry into Australia's life insurance market.

GPG shares rose 4.8% to NZ$1.53. Executives Gary Weiss and Michael Jefferies resigned from Tower's board.

By Jonathan Underhill

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