Former LV boss Mark Hartigan makes use of scare techniques to promote tech agency
- Discredited boss trying to bag a £20m bonus at his latest venture
- Wefox was valued at £3.6bn less than two years ago
- Hartigan warns that fintech could become insolvent and is looking to sell
Reputation in tatters: Mark Hartigan
The discredited boss who tried to sell mutual insurer LV to a US buyout firm is trying to bag a £20 million bonus at his latest venture.
Mark Hartigan, a former Army colonel, was forced to quit LV after members voted against his controversial plan to hand the 181-year-old mutual to private equity barons at Bain Capital.
He argued at the time that the private equity deal was necessary for LV’s long-term survival. Now he is accused of using ‘the same scare tactics’ at insurance tech company Wefox, where he became chairman and chief executive after leaving LV. He was ousted following a campaign by the Mail on Sunday and Daily Mail.
The £530 million deal he had tried to concoct was overturned in 2021 when he failed to garner enough support from LV policyholders.
Despite this disastrous episode, Hartigan walked away with £3.5 million from his three years at the mutual, including a £500,000 ‘golden goodbye’.
Wefox is a Berlin-based business that was valued at £3.6 billion less than two years ago. But fintechs have since fallen out of favour with investors.
In a memo circulated to shareholders earlier this month – first reported by Sky News – Hartigan warned that Wefox could become insolvent ‘in August, or potentially even earlier’. He plans to close a number of subsidiaries to stem losses.
But the Mail on Sunday understands Hartigan has also put Wefox up for sale and is in advanced talks to sell the business to Ardonagh, a leading London insurance broker.
If he succeeds, sources say he will pick up a £20 million bonus for completing the deal. One disgruntled Wefox investor said Hartigan had been ‘trying to frighten all of us into believing the business is in terminal trouble, but we don’t believe him.
‘This is exactly the type of scare tactics he used at LV when he was trying to sell the business on the cheap to Bain Capital,’ the investor added. ‘Wefox is fundamentally a fast growing and sound business that just needs further investment.’
Another source added: ‘Hartigan is putting maximum pressure on investors to approve his plan to sell at a knockdown price to Ardonagh – and collect his [£20 million] bonus.
‘But some of the investors are discussing how to fight against it, remove him and come up with an alternative plan.’
The vote to keep LV – formerly known as Liverpool Victoria – from Bain’s clutches was a victory for mutuality and LV has since recovered. It posted a pre-tax profit of £107 million in 2023, a big turnaround from the £145 million loss the previous year.
David Hyman, who replaced Hartigan as chief executive, has vowed to keep LV’s mutual status and protect it from asset-strippers.
A number of private equity takeovers of household names including department store Debenhams have been heavily criticised.
The proposed sale of LV was particularly controversial as the life insurer is owned by policyholders and run entirely for their benefit. It was set up in 1843 to help the poor of Liverpool pay for a dignified funeral for their loved ones and is still owned by more than one million of its members.
Hartigan and former LV chairman Alan Cook left with their reputations in tatters after spending more than £30 million of policyholders’ money on the doomed Bain deal. Hartigan was branded ‘shameless’ by Labour MP Gareth Thomas, chairman of Parliament’s all-party group on mutuals, having ‘taken members for fools at every chance he had’.
Cook, a former managing director of the Post Office, has also come under fire for writing an email saying sub-postmasters wrongly accused of theft had ‘their hands in the till.’ He apologised last month. Wefox is backed by some of the world’s largest tech investors, including the Abu Dhabi sovereign wealth fund Mubadala.
Ardonagh’s investors include the Abu Dhabi Investment Authority, Mubadala’s sister company.
Wefox declined to comment on the Ardonagh sale talk or Hartigan’s bonus but insisted he would lead the firm ‘through the next phase of development’. This involves ‘a consolidation and concentration of Wefox’s international activities’ after years of rapid growth, a spokesman added.
Ardonagh was also approached for comment.
