Kingdom Holding Company (KHC), the conglomerate controlled by Saudi Arabian prince Alwaleed Bin Talal, has acquired a 3.79% in insurance, savings and retirement firm Phoenix Group.
Filings published on the Saudi Exchange show the Riyadh-based company bought SAR 1.06bn (£233m, $284m, €277m) worth of shares in Phoenix Group – which has a market cap of £6.4bn.
London Stock Exchange documents currently show that KHC holds a 3.35% stake as of 27 July 2022.
International Adviser asked Phoenix Group about the investment and the figures – but it declined to comment.
Share price in Phoenix Group has risen since the announcements to £6.45 from £6.26 – but share price is down 5.67% for the year.
The conglomerate said that the investment is a continuation of KHC’s strategy to invest in blue-chip companies that are considered “market leaders in their field”. It recently acquired a 6.8% stake for £224m in UK-listed fund group M&G.
KHC is majority owned by Bin Talal, the Saudi prince and billionaire, who was targeted in a corruption crackdown in 2017. A well-known Wall Street investor, Bin Talal has investments in JD.com, Uber, Lyft and Twitter via KHC. He also owns a meaningful stake in Citigroup, having first invested in the bank in the 1990s.
In May, he sold 16.8% of his stake in KHC to Saudi Arabia’s sovereign wealth fund, the Public Investment Fund. A grandson of the first Saudi Arabian monarch, King Ibn Saud, Bin Talal is nephew to former ruler King Abdullah Saud who died in 2015.
Rise of the Phoenix
Phoenix Group has been very active in the M&A market over the last few years with its biggest deal coming in 2018 with the acquisition of Standard Life Assurance for £3bn.
At the time, the deal involved a strategic partnership with Standard Life Aberdeen, now Abrdn, which became a leading shareholder in Phoenix – as it is now at 10%.
Then, in 2021, Phoenix sold its Standard Life Assurance UK investment platform-related products, which include the Wrap Sipp, Onshore Bond and UK Trustee Investment Plan, to Abrdn for a cash consideration of £115m.
In return, Phoenix acquired the whole Standard Life brand – effectively ending the 2018 partnership agreement. But the two firms will re-entered into a 10-year strategic asset management partnership, which will see Phoenix leveraging the portfolio management and investment strategy capabilities of Abrdn.
In 2020, Phoenix Group revamped its long-term savings and retirement business into two divisions ‘open’ and ‘heritage’.
The company was in talks to sell its European operation in 2021 – but discussions failed to materialise into an agreement. But it did sell its subsidiary Ark Life Assurance Company to Irish Life Group in the same year.
