Charles Taylor plc Acquires Scottish Widows International Limited
Charles Taylor plc announces today it has agreed for its subsidiary, Metrowise Limited, to acquire Scottish Widows International Limited ("SWIL"), a Jersey life insurer in run-off, from Scottish Widows plc. SWIL provides unit-linked life insurance policies and portfolio bonds to individual investors.
The acquisition is part of Charles Taylor's strategy to make tactical acquisitions in the international life insurance sector to grow its life insurance business in the Isle of Man and generate cash releases for the Company.
It is intended that SWIL will be re-domiciled to the Isle of Man following the acquisition and that its policies will subsequently be transferred into Charles Taylor's wholly owned Isle of Man life insurance subsidiary LCL International Life Assurance Company Limited ("LCLI"), subject to court approval.
The initial consideration is £2.0m, to be met from existing cash resources. Subsequent payments of £3.0m will be made after re-domiciliation and £7.5m payable following the long term business transfer, or after 18 months at the latest. The total consideration will be £12.5m. The gross assets of SWIL were £95m and net assets were £16m as at 30th June 2014. Adjusted profits were -£0.1m in 2013. The transaction is expected to be earnings enhancing, after transaction costs and has the potential to generate cash releases in the medium term.
The acquisition is subject to regulatory approval by The Jersey Financial Services Commission.
David Marock, Group Chief Executive Officer, Charles Taylor said:
"This agreement to acquire SWIL follows our recent purchase of Nordea Life and Pensions. It demonstrates our commitment to grow our life insurance business in the Isle of Man. Over the last four years we have made four life insurance company acquisitions.
"Charles Taylor has administered SWIL's policies for the last eight years. This means that policyholders will experience a seamless change of ownership and will continue to enjoy the same excellent levels of service.
"By merging the business into Charles Taylor's life insurer, we will be able to deliver further efficiencies without compromising service. We expect the acquisition to be earnings enhancing and generate an early payback of our investment."