LCCG confirmed on its website that on 19 April, Harcourt Life Assurance, its main operating entity, “entered into a definitive agreement” to acquire the share capital of Aviva Life International from Aviva.
The purchase, subject to regulatory approval, is expected to close later this year.
A spokesperson for Aviva also confirmed the sale, adding “this small stand-alone international life business is a non-core activity for Aviva that has been identified as non-strategic to the group”.
Most of Aviva Life International’s customers come from 115 different jurisdictions, said the source, with the majority residing in the UK, Isle of Man, and Channel Islands.
The unit, which is entirely separate from Aviva’s other operations, was set up in 2000 and has £1.2bn ($1.7bn, €1.5bn) of assets under management, mostly in single premium offshore bonds. It closed its book, of approximately 6,000 policyholders, to new customers in 2010.
While active, the entity provided offshore bonds in a mix across three broad categories: unitised with profit; unit-linked bonds and an open architecture product.
Axa sale
The move, which has remained under the radar until now, predates the company’s announcement last week of a similar acquisition of French insurer Axa’s Isle of Man operations.
LCCG’s buyout of Axa Wealth International, one of the largest UK providers of offshore bonds across the Isle of Man and Dublin, will see the company take over the insurer’s £9bn book of assets.
LCCG buyouts
LCCG specialises in the acquisition and consolidation of books of life assurance businesses in Europe from investment companies that are no longer open for business. It was founded in 2013 by Paul Thompson and Ian Maidens who between them have over 40 years of experience in the life sector.
Although the firm has its headquarters in London, Harcourt Life is based in Dublin and regulated by the Central Bank of Ireland, LCCG’s holding company is registered in Guernsey.
In December last year Harcourt Life bought Scottish Mutual International from Phoenix Life, which is part of the Phoenix Group.
Increased M&A
If successful, the acquisition will be the latest move towards consolidation among European insurers as low interest rates and the new Solvency II capital requirements push them to adjust their business models and offload less profitable units.
In April, Dutch-headquartered life group Aegon agreed to sell two-thirds of its UK annuity book, worth £6bn, to insurer Rothesay Life.
Just weeks earlier, The Financial Times reported that UK insurer Phoenix Group is close to securing a £500m buyout of smaller rival Sun Life from French insurance giant Axa.
Meanwhile, Standard Life is understood to be bidding for Axa’s other business Elevate, a platform that helps UK IFAs manage client investments.
