The transaction is expected to complete by July 31, subject to approval by the FSA and the South African Reserve Bank. Discovery linked up with Prudential in a joint venture that comprises private medical insurance provider PruHealth and protection provider Pru-Protect in 2007.
Following completion and a transitional period, the insurer intends to rebrand Standard Life Healthcare under the PruHealth brand.
Standard Life says the manufacturing of PMI is not core to its UK strategy, which is focused on the long-term savings and investments market.
It says the cash proceeds from the sale will help it grow the business. About 562 emp-loyees will transfer as part of the transaction.
Chief executive David Nish says: “Standard Life Healthcare is a leading business in the UK PMI market but in the context of sharpening our focus on the long-term savings and investments market, it is not core.”
CBK Colchester principal Peter Chadborn says: “Discovery is a well respected provider in its field and so this is a satisfactory conclusion for Standard customers.”
Discovery operates in insurance and long-term savings in South Africa, the UK, the US and China. It is listed on the Johannesburg Stock Exchange with a market capitalisation of £1.9bn.