Hundreds of insurance workers in Colchester are facing an uncertain future after Guardian Royal Exchange was taken over.

Axa, Sun Life and Provincial (SLP) paid £3.45 billion for the insurance giant, and has warned several hundred jobs could go.

One of the company's major bases is in Ipswich but Guardian Direct at Severall's Business Park could also be affected.

SLP was yesterday refusing to say where job cuts will come from or how many will go. Union chiefs have welcomed the deal in light of recent rumours that the insurance company would be taken over by another rival. The deal would have cost around 5,000 jobs.

A spokesman for the Manufacturing, Science and Finance Union said: "Takeovers and mergers and rarely good news for our members as it invariably leads to job losses, but in this case it is generally welcomed.

"A few weeks ago we were talking about thousands of job losses and this takeover is the best one for everyone concerned."

He added: "We are hoping that there will not be any compulsory redundancies."

Job losses will come from redeployment, voluntary redundancy, early retirement and natural turnover.

But the Banking, Insurance and Finance Union said it greeted the takeover with a mixture of "relief and caution".

Assistant secretary Bernadette Fisher said: "Guardian staff will feel some initial relief a decision has been made and that it is Axa. However they know that any takeover will bring significant changes.

"We have been given an assurance terms and conditions, including pensions, will be preserved and compulsory redundancies will be avoided where possible. However Axa are saying there will be some job cuts over time."

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