Lloyds TSB announced today that subsidiary Scottish Widows had reached an agreement with Deutsche Bank to sell the business for £977m with the deal expected to go through in the second half of 2007.
Scottish Widows Investment Partnership has entered into a ten year agreement to continue to manage Abbey Life’s funds as part of the deal.
Abbey Life has been closed to new business since 2000. As of December 31, 2006 it managed £12bn of assets and 1.2 million policies.
Lloyds TSB group chief executive Eric Daniels says: “We conducted a review of Abbey Life and came to the conclusion that a sale of the business is in the best interest of the Group, as well as Abbey Life’s policyholders and staff.
We expect the proceeds of the sale, net of costs, to be distributed from Scottish Widows to Lloyds TSB Group in line with Lloyds TSB’s objective to continue to improve its capital efficiency.”