Acquisition

Chesnara PLC

16 May 2023

 

LEI Number: 213800VFRMBRTSZ3SJ06

16 May 2023

CHESNARA plc

("Chesnara" or "the Company")

ACQUISITION OF ONSHORE INDIVIDUAL PROTECTION BUSINESS FROM CANADA LIFE UK

Chesnara plc, the European life and pensions consolidator, today announces it has reached an agreement with Canada Life Limited ("Canada Life UK") to acquire its onshore individual protection line of business, which was closed to new business in November 2022. As a result of the acquisition, the life insurance and critical illness policies for approximately 47,000 customers will transfer to Chesnara's UK subsidiary, Countrywide Assured plc ("Countrywide Assured").

Customers' policies are expected to transfer to Countrywide Assured in 2024, subject to the completion of a court-approved Part VII transfer. In the interim period, Canada Life UK will reinsure the portfolio to Countrywide Assured, effective from 31 December 2022. The consideration as part of the reinsurance agreement is £9 million, funded from internal Group resources, and we expect the transaction to provide an uplift in the Group's Economic Value of approximately £7 million and additional cash generation over the next five years of approximately £16 million. The impact on the Group's Solvency II ratio is expected to be broadly neutral.

Steve Murray, Group Chief Executive, commented:

"We are delighted to be welcoming these 47,000 protection customers to Chesnara and they can be confident we will continue to provide high levels of customer service as part of a financially strong group. I am pleased that a company as highly regarded as Canada Life has placed its trust in us to support these customers and look forward to working with the team going forward.

This transaction, the fifth deal announced in the last two years, will add additional scale to our UK business and provides an attractive return on investment for our shareholders.  We continue to see a range of M&A opportunities and are highly confident in our ability to finance and execute such transactions on attractive terms for both vendors and our shareholders."

Chesnara was advised by Burness Paull and Canada Life was advised by Herbert Smith Freehills.

For further information, please contact:

Investor Enquiries

Sam Perowne

Head of Strategic Development & Investor Relations

Chesnara plc

E - [e-mail]

Media Enquiries

Roddy Watt

Director, Capital Markets

FWD

T - 020 7280 0651 / 07714 770 493 

E - [e-mail]

Notes to Editors

Chesnara (CSN.L) is a European life and pensions consolidator listed on the London Stock Exchange.  It administers approximately one million policies and operates as Countrywide Assured and CASLP in the UK, as The Waard Group and Scildon in the Netherlands, and as Movestic in Sweden.

Following a three-pillar strategy, Chesnara's primary responsibility is the efficient administration of its customers' life and savings policies, ensuring good customer outcomes and providing a secure and compliant environment to protect policyholder interests. It also adds value by writing profitable new business in Sweden and the Netherlands and by undertaking value-adding acquisitions of either companies or portfolios.

Over the past two years, Chesnara has announced five acquisitions: Canada Life UK's onshore individual protection business and Sanlam Life & Pensions in the UK, together with Robein Leven, the insurance portfolio of Conservatrix and a small portfolio from SRLEV N.V. in the Netherlands.

Consistent delivery of the Company strategy has enabled Chesnara to increase its dividend for 18 years in succession.

Further details are available on the Company's website (www.chesnara.co.uk).

 

END