Legal & General is set to buy Suffolk Life in a bid to increase its presence in the Sipp market.
L&G will pay £15.75 per share for the company valued at £62m.
Legal & General chief executive Tim Breedon says L&G is focusing its attention on pensions and the “mass affluent” market.
He says: “Suffolk Life is an outstanding business which has developed a leading position in the fast growing bespoke SIPP market. Combining Suffolk Life’s product expertise and service delivery with Legal & General’s extensive distribution reach will transform Suffolk Life’s growth potential and create an outstanding business within Legal & General.
“Growing our savings business is a strategic priority for Legal & General. Pensions and the mass affluent market are areas we have targeted for development. Suffolk Life enables us to accelerate our growth in these key expanding markets.”
Suffolk Life chief executive officer Henry Catchpole says: “Our strategic review has confirmed that, whilst the development of the pensions landscape presented Suffolk Life with attractive opportunities to grow profitably, Suffolk Life’s development could be accelerated through being part of a larger group which offered clear distribution synergies.
“We are therefore delighted to recommend the offer from L&G which the Board, in conjunction with our advisers Fenchurch Advisory Partners, has concluded is in the best interests of our clients, employees and shareholders.”