In its 2013 year-end results, published this morning, Royal London said it was paid a total consideration of £126m, comprising a cash consideration of £105m and deferred consideration with a fair value of £21m, for the business.
Royal London added, the nominal value of the deferred consideration is a fixed amount of £29m plus interest accruing at the rate of 0.75% per annum, all of which is payable five years after the date of sale.
The UK’s largest mutual life and pensions company, said the sale had created an operating loss during the 2013 financial year of £40m, but added in a statement: “[The sale] has allowed value to be returned to our members by releasing value held offshore back to the UK, whilst enabling us to focus on our core strategy for the group going forward.”
The sale of Royal London 360, now RL360, to its management team, was led by chief executive David Kneeshaw and completed on 14 November last year.
At the time, Kneeshaw said: “We believe this transaction is the first of its type in the offshore life space, and it allows us to follow a long-term plan with the capital stability we require to continue to expand our business internationally and enhance our platform-linked approach with the UK.
“We remain fully committed to our existing products, markets, partners and customers. Once the transaction is completed we will move swiftly to realise RL360°’s existing growth plans.”
Click here to read an exclusive interview with RL360 CEO David Kneeshaw
