The Canada Life Group has expanded its UK proposition after it agreed to acquire financial services provider Retirement Advantage.
The UK arm of international financial services group GreatWest Lifeco, said in a statement that it has agreed to purchase the specialist annuity provider for an undisclosed sum, which now allows it to enter the equity release market.
Retirement Advantage, which has roots dating back to 1852, was created in 2015 when funds managed by TDR Capital LLP merged the retirement income and equity release divisions of MGM Advantage and Stonehaven.
Following the deal, the number of annuity providers active in the UK market now stands at six: Aviva, Canada Life, Legal & General, Scottish Widows, Hodge Lifetime and Just Retirement.
Retirement Advantage has over 30,000 pension and equity release customers, and more than £2bn of assets under management including a £1.5bn block of in-force annuities (as of 30 June 2017).
‘Broader product suite’
Doug Brown, executive vice-president and chief executive, Canada Life UK, said “Canada Life has operated in the UK since 1903 and is a highly regarded provider of retirement income, investment and employee protection solutions. This transaction enhances our position and broadens our product suite to include equity release mortgages.”
“This transaction reaffirms our organisation’s commitment to the UK and will further strengthen Canada Life’s position,” said Paul Mahon, president and chief executive of Great West Lifeco.
Craig Fazzini-Jones, group chief executive, Retirement Advantage, said: “This acquisition is a positive endorsement of the business plan we adopted following the UK pension reforms announced in 2014 that transformed our business and drove the creation of innovative retirement solutions.
“As we join Canada Life, we will be well positioned to build upon that success and provide greater retirement protection for our customers.”
The transaction is expected to close in the fourth quarter of 2017 and is subject to customary regulatory approvals, and certain closing conditions. Regulatory approval is likely to take between three and six months, during which time it will be business as usual for the companies and their customer service, the company said.