OTTAWA (dpa-AFX) - Phoenix Group Holdings plc (PHNX) on Thursday announced the acquisition of Sun Life UK, a closed book UK life insurance company, from Sun Life Financial Inc. (SLF) for cash consideration of 248 million pounds, implying a price to shareholder Own Funds ratio of 83 percent. The acquisition is expected to complete in the first quarter of 2023.
The deal is expected to deliver approx. 470 million pounds of incremental long-term cash generation, of which approximately 30 percent would emerge in the first three years.
The acquisition is expected to result in approx. 125 million pounds of integration synergies, net of costs, from cost efficiencies and capital management actions, representing around 50 percent of the consideration paid.
The company has also agreed on a new long-term strategic asset management partnership with Sun Life that complements its existing relationships and further enhance and diversify the liquid and illiquid credit origination capabilities in North America.
The value and cash flow generated through this acquisition is expected to support a sustainable 2.5 percent inorganic increase in the Group's dividend, to take effect from and including the 2022 Final Dividend, subject to completion.
Shares of Phoenix Group Holdings closed Wednesday's trading at 652.80 pence, up 7.40 pence or 1.15 percent from the previous close.
Shares of Sunlife Financial Inc. closed Wednesday's trading at $45.90, down $0.16 or 0.34 percent from the previous close.
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