Friends Provident has rejected Resolution's latest takeover offer, which was deemed unsuitable, as it would only have benefited Resolution.
Newly listed Resolution Britain's biggest manager of closed life insurance funds, has been in prolonged talks to merge with rival life insurance firm Friends Provident for the past few weeks.
Clive Cowdery's first two rejected approaches were a £1.7bn bid and an all-share takeover offer.
Friends, which was established in 1832, is still open to a deal with the life insurance firm, but one which is of mutual benefit to both companies.
Cowdery was asked to reconsider certain aspects of the bid including the price, which would not have offered its shareholders a premium. It is understood that Resolution may be prepared to make a hostile bid.
Resolution was set up by Mr Cowdery in December last year to purchase loss-making financial services businesses.
It is thought that other targets may include firms such as Legal & General and Clerical Medical, or the divisions of other financial companies such as Scottish Widows.
