Chesnara Regulatory News (CSN)

CHESNARA plc

("Chesnara" or the "Company")

25 November 2021

LEI Number: 213800VFRMBRTSZ3SJ06

ACQUISITION

CHESNARA ENHANCES ITS POSITION AS A LEADING LIFE & PENSION CONSOLIDATOR IN THE NETHERLANDS WITH THE ACQUISITION OF ROBEIN LEVEN N.V.

TRANSACTION HIGHLIGHTS:

· Chesnara has entered into an agreement with Monument Re Group to acquire Robein Leven, a specialist provider of traditional and linked savings products, mortgages and annuities in the Netherlands.

· The acquisition adds further scale to Chesnara's Netherlands closed book platform by increasing AUA by 51% and policies by 7%[1].

· Cash consideration of £13.0m[2] funded from existing resources within Waard, Chesnara's closed book consolidator platform in the Netherlands, representing an attractive 21% discount to Chesnara's estimate of EcV[3].

· Robein Leven is well capitalised and is expected to generate incremental annual cash of c.£2m under steady state conditions.

· The Transaction, which is consistent with Chesnara's strategy and will deliver attractive shareholder value, is the group's sixth acquisition in the Netherlands since 2015 and follows the recently announced acquisition of Sanlam Life and Pensions in the UK.

TRANSACTION OVERVIEW:

Chesnara plc ("Chesnara" or the "Company"), through its existing Netherlands-based closed book platform, the Waard Group ("Waard"), has agreed to acquire 100% of the shares of Robein Leven N.V. and its subsidiary (" Robein Effecten Dienstverlening"), a specialist provider of traditional and linked savings products, mortgages and annuities in the Netherlands, from Monument Re Group (the "Transaction").

The Transaction consideration of £13.0 million[4] will be paid in cash at completion and will be funded from existing resources within Waard.

For the year ended 31 December 2020, Robein Leven reported gross assets of £223.8m and was well capitalised with a solvency ratio of 211%. The business has been operating on a fully closed-book basis since 2018. Following completion, the business will be integrated within Waard.

The Transaction is subject to customary regulatory approvals from the Dutch Central Bank ("DNB") for the change of control and from the Netherlands Authority for Consumers and Markets ("ACM") for Antitrust clearance. It is expected to complete in the first half of 2022.

STRATEGIC RATIONALE AND BENEFITS OF THE TRANSACTION:

The Transaction is consistent with Chesnara's strategy and will deliver attractive shareholder value:

- Scale enhancement: Robein Leven enhances the scale of Chesnara's existing Dutch closed book platform by increasing AUA by 51% to £660.9 million and policies by 7% to over 133,000[5].

- Attractive cash generation profile supporting our dividend policy: The business is well capitalised and offers good potential for phased and orderly capital extraction over time, resulting in expected incremental annual cash of c.£2m under steady state conditions.

- Compelling financial terms: The consideration represents an attractive discount of 21% to Chesnara's estimate of Economic Value ("EcV")[6]. Chesnara estimates that the Company's EcV gain on completion of the Transaction will be c.£3.5 million or c.2.4p per share.

- Enhances Chesnara's position as a leading consolidator: Robein Leven is strongly aligned with Chesnara's strategic objective of acquiring and integrating life and pension companies and books of business within its target and value range, while supporting the Company's ongoing dividend strategy.

The Transaction follows the recently announced acquisition by Chesnara of Sanlam Life & Pensions in the UK and the previously completed acquisitions by Chesnara in the Netherlands of Waard Group in 2015, Legal & General Nederland (our local open book platform subsequently re-named Scildon) in 2017 and the portfolio acquisitions from Monuta in 2019, Argenta Bank in 2020 and Brand New Day in 2021.

Commenting on the Transaction, Steve Murray, Chief Executive Officer of Chesnara stated: "We are delighted to announce the acquisition of Robein Leven; our sixth acquisition in the Netherlands since 2015, the fourth of these for Waard, our closed book consolidator in the Netherlands. This transaction provides attractive returns for our shareholders and further reaffirms the focus we have on our acquisition strategy. We remain optimistic about the opportunities for further deals in the Netherlands and elsewhere. We look forward to welcoming Robein Leven customers and employees to Chesnara."

Enquiries

Chesnara

Steve Murray, Chief Executive Officer - 01772 972079

David Rimmington, Chief Financial Officer - 01772 972079

For further information, please contact:

Roddy Watt

Director, Capital Markets

FWD

Forward thinking communications

T - 020 7280 0651 / 07714 770493

E - roddy.watt@fwdconsulting.co.uk

Notes to Editors

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 (as it forms part of retained EU law as defined in the European Union (Withdrawal) Act 2018).

About Chesnara plc

Chesnara is a life and pensions consolidator listed on the London Stock Exchange. It administers approximately 900,000 policies with approximately £8.7 billion of assets under management as at 30 June 2021, with those assets spread broadly equally across businesses in the UK, the Netherlands and Sweden. Chesnara operates as Countrywide Assured 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.

Chesnara has a proven track record of acquiring and consolidating life and pension portfolios and businesses. The acquisition that is the subject of this press release is evidence of the continuation of this capability. The acquisition process adds value for our shareholders whilst also providing a solution for vendors to realise value and release capital. This is achieved by vendors divesting life and pensions businesses or portfolios which are not core to their wider strategic focus, or where diminishing scale creates operational and hence financial viability pressure. Chesnara's robust regulatory framework and strong solvency ensures policyholder interests are well protected and remain at the heart of any divestment decision.

Consistent delivery of the company strategy has enabled Chesnara to increase its dividend for 17 years in succession.

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

Important Notice

This announcement contains forward-looking statements with respect to the operations, performance and financial condition of Chesnara. By their nature, these statements are subject to risks, assumptions and uncertainties that could cause actual results to differ materially from those expressed or implied because they relate to future events. Unless otherwise required by applicable law, regulation or accounting standard, the Company does not undertake to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise. Nothing in this document should be construed as a profit forecast.

Nothing contained in this announcement constitutes or shall be deemed to constitute an offer or invitation to invest in otherwise deal in any shares or other securities of Chesnara.