Liverpool Victoria Financial Services Limited (LV=) has agreed to sell its savings & retirement and protection businesses to private investment firm Bain Capital in a transaction valued at £530m.
The transaction will take place in two phases, with Bain Capital first purchasing LV=’s subsidiary LVLC together with the administration and new business infrastructure.
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It is expected to close by the end of next year, subject to the conclusion of the legal process and necessary approvals.
As part of the agreement, LV’s with-profits business will be ring-fenced in a separate fund and closed to new business.
For LV=, the transaction is anticipated to increase the capital available for distribution up to 40%. The company will use it to increase the payments to with-profits members as their policies mature.
Commenting on the deal, LV= chairman Alan Cook said that the transaction is the culmination of an extremely thorough and robust strategic review.
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By GlobalDataCook said: “As a newly standalone life and pensions business in an increasingly competitive market, the Board recognised that LV= required significant long-term investment to be sustainable.”
The deal will provide LV= with the external investment required to expand its business and offerings for the continued benefit of customers and IFAs.
LV= CEO Mark Hartigan added: The partnership with Bain Capital recognises the opportunity to further invest to develop LV= at a time when it is well positioned, growing market share, expanding its products and trading resiliently, despite the pandemic.”
Bain Capital Credit global head of Insurance Matt Popoli said: “We are delighted by the opportunity to provide long-term support to LV=’s Board of directors and management team on this transaction, which delivers certainty and value to LV=’s members.”
In September this year, LV= said that it is in talks over a possible takeover by The Royal London Mutual Insurance Society.
