AN MP has said customers of LV= have the “right to know” the business’s priorities after talks about a merger with rival Royal London collapsed.

The discussions broke down shortly after the Dorset-based investment, pensions and protection business confirmed they had started.

The board of the mutual organisation planned last year to sell it to the American private equity fund Bain Capital for £530million. But it could not muster the required 75 per cent support from LV=’s 1.2m members.

LV=, which had previously suggested it would struggle to survive without Bain Capital’s investment, now says it is committed to an being an independent mutual.

Gareth Thomas, the Labour MP who chairs the all-party parliamentary group on financial mutuals, said: “The fact that LV= have pulled out of talks with Royal London just days after announcing them begs many questions, including why these talks have been shrouded in secrecy and why, considering their new commitment to mutuality, they ever pursued the ill-fated sell off to Bain in the first place?

“The continued opaque approach of the board must change if their recently stated commitment to mutuality is to be believed and LV members must have the right to know the strategy and priorities of the board. Regulators must be also much more assertive in assuring this transparency for LV=’s members.

“To demonstrate they are truly committed to mutuality, the key will be in getting a chief exec who has worked in the mutual sector and understands their ethos.”

Seamus Creedon, LV= interim chair following the resignation of Alan Cook, said after the breaking-off of talks: “We thank Royal London for its engagement and we look forward to operating alongside it as part of a vibrant mutual sector.

“The strength of LV=’s business performance over the past 18 months combined with its operational progress has strengthened the board’s belief in, and commitment to, the continuation of our status as an independent mutual.

“We have heard what our members have said about the importance of mutuality and the continuation of the LV= brand.

“We continue to maintain our strong capital position, are trading well and building a successful future for LV=, its members, employees and wider communities.”