FRIENDS PROVIDENT has rebuffed a fresh attempt by the American private-equity firm JC Flowers to open talks about buying all or part of the embattled life insurer.

JC Flowers is understood to have sent a letter to the insurer’s board last week in an attempt to open discussions.

The letter also demanded that any talks would be exclusively with Sir Adrian Montague, the executive chairman. The request was seen as unusual because it would sideline Jim Smart, the finance director, who played a central role in the group’s recent strategic review.

Friends’ board is understood to have rejected the approach on the grounds that JC Flowers’s plans were too vague. Bankers said the letter was more of an overture and did not include any form of takeover offer or detailed financial terms.

The insurer’s investment-banking advisers, Goldman Sachs and JP Morgan Cazenove, told the American group on Friday that Friends was not interested in opening discussions at this stage.

The rejection puts pressure on JC Flowers to come back with more concrete proposals.

JC Flowers has built a 2.7% stake in Friends. Earlier this year, Ravi Sinha, the former Goldman Sachs banker who heads JC Flowers’ European operations, wrote to the board. The company is said to have indicated it would be prepared to pay about 175p a share, valuing the business at about £4 billion. Friends has been holding out for 200p a share.

The latest manoeuvrings came just a week after Friends’ strategic review received a cool response from shareholders, with some labelling it “shocking”.

Friends is aiming to sell Lombard, its international wealth-management subsidiary, its 52% stake in F&C Asset Management and intermediary Partheon. Analysts estimate the sales could raise more than £1 billion.

The group is also radically shrinking its life-insurance business, cutting 600 out of 4,000 jobs and slashing its dividend. Pretax profits for 2007 will dive to only £20m from £509m in 2006 after one-off charges.

JC Flowers has been stalking Friends since before last May when it approached several insurers, including Axa, about a potential joint break-up bid.

Bankers said the private-equity group might yet look at buying parts of the business or launch its own break-up plan.

JC Flowers raised a new $7 billion (£3.6 billion) fund last year. China Investment Corporation, the Chinese sovereign-wealth fund, is in talks about investing $4 billion in a new vehicle to buy ailing financial groups.

Despite JC Flowers’ interest, Friends’ shares slipped to131¼p.

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