Analysts have supported claims by Friends Provident and Resolution Life that the latter's funds business is worth more than the value ascribed to it by the market, as the two UK insurance groups revealed the terms of their proposed £8.5bn (€12.3bn) merger and paved the way for rivals to gatecrash the tie-up.

Resolution Asset Management, which is due to be merged with F&C Asset Management if the tie-up with Friends Provident goes ahead, is worth more than the £134m included in the book value of its parent's assets as at June 30, according to Resolution.