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Phoenix acquires Abbey Life in £935m deal

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Deutsche Bank has agreed to sell Abbey Life to rival closed-book provider Phoenix Group in a deal worth £935m.

The deal is subject to regulatory approval, and will result in an expected pre-tax loss for Deutsche Bank of €800m (£688m).

Abbey Life will add £10bn of assets under management to Phoenix’s Book and around 735,000 policyholders.

Phoenix has been working on the acquisition since March, when it hired bankers to advise on the bid.

Abbey Life includes books of business from companies including London and Edinburgh Life, Excess Life, Target Life and Hill Samuel Life.

Abbey Life was among six firms to be referred to FCA enforcement earlier this year following a review of closed book firms.

Deutsche Bank chief executive John Cryan says: “We are pleased to have reached this agreement with Phoenix Group, a specialist life fund provider which is well qualified to serve Abbey Life policyholders.

“Deutsche Asset Management will continue to focus on its core businesses of active, passive and alternatives, while this transaction will also strengthen Deutsche Bank’s capital position. We continue to build a simpler and better Deutsche Bank.”

Phoenix Group chief executive Clive Bannister says: “This is a pivotal deal for Phoenix, giving us the platform and scale to continue as a leader in the consolidation of the UK life industry.

“This attractively-priced deal meets precisely Phoenix’s areas of strategic focus and stated acquisition criteria, whilst significantly increasing our cash generation and supporting a further increase in our proposed dividend.

“Furthermore, Abbey Life policyholders will benefit from stable ownership, improved service levels and a robust governance framework.”

In May Phoenix acquired the remaining part of Axa Wealth for £375m. The acquisition included Embassy, Axa’s off-platform investment and pension division, and its direct protection business Sun Life.

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Guide: how to… communicate with your pension members

Effective communication of your pension scheme is a large part of getting auto-enrolment right. Delivering the same message to all employees is not necessarily the way to go. To assist you with the communication of your pension scheme, we have provided some key areas to think about, such as:

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. Another firm that should be censored under the Trades Description Act. There is no life in Abbey – it’s a dead company. Just as there is no life in Standard as they don’t offer life products.

    So now the vulture funds are shuffling moribund companies between themselves in the hope of squeezing every last drop for already disadvantaged customers. I wonder where the Treating Customers Fairly mantra falls into this and whether the regulator will be taking any care to ensure that customers do not continue to be ripped off.

  2. ^Couldn’t have put it better myself.

    From significant experience, TCF and consolidators seem to be mutually exclusive.

  3. DAM must be very keen to offload.

  4. Picking over the bones

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