Fresh concerns have been raised over the future of mutual insurance firm LV= after it emerged that bidders could break it up after a takeover. The 178-year-old firm, originally known as Liverpool Victoria, is being sold to US private equity firm Bain Capital for £530m, in a controversial deal that would end its member-owned status if its members back the takeover in a December vote. However, fellow mutual insurer Royal London, which had a bid for the company rejected, has proposed a deal to Bain Capital that involves splitting parts of LV= with the US investment firm, according to proposals seen by the Mail on Sunday. Royal London reportedly suggested in an email to LV=’s chief executive, Mark Hartigan, that it could acquire some of LV=’s policies, leaving Bain to spin off the rest of the business into a separate entity. It also proposed entering an ‘“early three-way discussion” between Royal London, Bain and LV=, if it looked like LV= members would reject the Bain deal currently on the table. The prospect of Royal London re-entering the process comes after it was beaten to an agreed takeover by Bain Capital last December. Some LV= members had complained they were not informed about the details of Royal London’s bid, which could have retained its mutual status. Royal London said in a statement it had been in contact with LV= and “asked them to consider if their current proposal to members could be enhanced”. It added: “We are ready to explore any option that delivers a better member outcome, including options that would allow LV= members to become members of Royal London. The board of LV= has not taken up our offer to discuss other possible options but our door is open and we remain ready to engage.” The board of LV= has come in for criticism for approving the deal with Bain, which would involve each of LV=’s 1.2m members getting a £100 payout, an offer criticised by some as paltry. Politicians have also expressed concern about the loss of a large mutual company, and voiced worries about asset stripping. Gareth Thomas, Labour’s shadow minister for international trade and chair of the all-party parliamentary group on mutuals, said a carve-up of the company would risk the long-term value members currently enjoy. “It makes sense for all the bids to be fully public, and everything from who the new directors are going to be, to tender documents, to Royal London’s bid, to Bain’s bid, to be fully out there on the record so that members can make their own choices,” he said.