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Deal talks continue for resilient Just Retirement

Just Retirement has confirmed that talks are ongoing about a possible offer for the group.

The enhanced annuity and equity-release provider said in November that it had received expressions of interest and revealed in its interim results last week that an announcement will be made regarding a potential acquisition in “due course”.

Just Retirement’s annuity sales for the second half of 2008 fell by 13 per cent to £272m from the previous year. Its annuity market share fell to 4.6 per cent from 5.2 per cent in the first six months of 2008. Equity-release sales rose by nearly 11 per cent to £82m.

On a European embedded value basis, operating profit was £32m, down from £37m on the . On international financial reporting standards basis, its profit was £7.4m, up by 54 per cent.

The firm’s solvency ratio was 170 per cent at the end of the year. It has set aside 126 basis points a year to reserve against defaults on its corporate bond portfolio, worth more than £1bn.

Chief executive officer Mike Fuller says: “Our selective pricing policy has enabled us to protect annuity margins in the face of strong competition, albeit at a cost of a small and temporary reduction in sales volumes. We have been able to continue to grow our equity-release business at highly favourable margins. Despite the impact of the extraordinary economic conditions, we have been able to protect our capital position and current trading is very encouraging.”

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