Legal & General is to sell its Dutch business, Legal & General Nederlands, to pensions and life insurer Chesnara for €160m (£135.7m), as it continues to shed non-core operations.
Established in 1984, Legal & General Netherlands is based in Hilversum, a town in the north of the country, and specialises in “adviser-led risk and investment-linked products, sold through independent financial advisers, [and] serving high-end affluent customers”, according to a statement issued by Legal & General today.
The Dutch L&G business also includes an established defined-contribution group pension platform, which focuses on Dutch SMEs, L&G said.
Currently the business looks after more than 170,000 policyholders, has funds under management of €2.2 billion, and in the first half of 2016, it registered gross written premiums of £25m.
Pieter Glas was named chief executive of the business in April.
Mark Gregory, group chief financial officer at L&G, noted that over the past two years the UK-based life insurance company, in its quest to focus on “scalable businesses in growth markets”, had disposed of “a number of operations we no longer regard as core, including our Irish, French, Egyptian and Gulf businesses”.
“Now we are doing the same with our Dutch business.
“We have also disposed of the Suffolk Life SIPP, business in the UK and agreed a sale of Cofunds,” he added.
UK-based life, pensions consolidator
Chesnara is a Preston, England-based, London Stock Exchange-listed consolidator of life insurance businesses and pension providers, which currently specialises in managing life and pension businesses in Sweden and the Netherlands as well as the UK. It was founded in 2004, when it initially consisted of Countrywide Assured, the closed life and pensions book that had been demerged from Countrywide plc, a large estate agency group.
According to its website, it administers around 910,000 life and pension policies on behalf of its policyholders, of which 349,000 are in the UK, 481,000 in Sweden and 80,000 in the Netherlands.
John Deane, chief executive of Chesnara, said that his company’s plan for the Dutch L&G operation would be to write protection and pension policies, as is the case with Chesnara’s Swedish subsidiary, Movestic.
He added: “This will complement our closed block consolidation business Waard. We see great opportunities for both organisations within the Chesnara group to deliver value to our customers, their advisers and our shareholders.”
Subject to approvals
The Legal & General Netherlands’ Works Council has been asked to consult on the transaction, as required under Dutch law. The transaction is subject to the signing of a “definitive agreement” and the approval of the Dutch regulator.
The sale of the business is expected to marginally improve the group coverage ratio, and return a small profit, L&G said.