22 Nov 2016 08:03
Date: 22 November 2016
On behalf of: Charles Taylor plc ("Charles Taylor" or the "Company")
Charles Taylor plc
Trading update and acquisition of a closed book of life assurance business from Zurich International Life Limited and Allied Dunbar International Fund Managers Limited from Zurich Insurance Company Ltd.
Charles Taylor announces today that it has agreed to acquire a closed book of international life assurance business (the "Book") from Zurich International Life Limited and Allied Dunbar International Fund Managers Limited ("ADIFM") from Zurich Insurance Company Ltd.
The acquisitions are part of Charles Taylor's strategy to make tactical acquisitions in the international life insurance sector to grow its life insurance business and associated services. The transaction will enable Charles Taylor to increase its revenue by managing the closed book and by providing policy administration services. The acquisition of ADIFM, which manages a collective investment scheme, will also enable Charles Taylor to generate fund management revenues and further extend its range of professional services by entering the international fund administration services market.
It is intended that a subsidiary of Charles Taylor will acquire ADIFM and that Charles Taylor's wholly-owned Isle of Man life insurance subsidiary, LCL International Life Assurance Company Limited, will reinsure the Book and subsequently accept the legal transfer of the majority of the Book, subject to regulatory and court approval.
The initial consideration, payable at completion which is expected in early 2017, is estimated at £2.5m, to be met from existing cash resources. A subsequent estimated payment of £1.5m will be made in the second half of 2017. The total consideration is estimated to be £4.0m. The relevant gross assets of ADIFM and the Book were £323.0m as at 30 June 2016. There are no separately identifiable historical revenues or profits attributable to the assets being acquired; Charles Taylor estimates the Book's current annual revenue to be £3.6m and profit to be £1.7m.
This acquisition, together with recent acquisitions and business developments, is expected to support the Group's earnings growth, although this is now anticipated to be somewhat lower than the market's previous expectations for 2017. It also enables the Group's ongoing investment in its major initiatives, and offsets the potential of the global claims environment remaining benign into 2017.
This announcement constitutes Inside Information within the meaning of article 7 of the EU Market Abuse Regulation.
David Marock, Group Chief Executive Officer, Charles Taylor said:
"This agreement to acquire the closed life assurance book from Zurich follows our purchase last year of Scottish Widows International. It demonstrates our commitment to grow our life insurance and servicing businesses in the Isle of Man. Over the last five years we have made five life insurance acquisitions."
"We have significant experience with acquiring and managing life businesses. We will work closely with Zurich to ensure that policyholders experience a seamless change of ownership and continue to enjoy the same excellent levels of service."
"I am particularly pleased that the transaction will enable us to enter the fund administration services market. This is very closely related to the policy administration service we already offer in the Isle of Man and opens up opportunities for us to deliver new services to fund managers in the Isle of Man and other international markets."
Clive Baker, Chief Executive Officer, Zurich International Life said:
"Zurich International Life has not been active in the portfolio bond market for some time. Charles Taylor has significant experience with acquiring and managing life businesses and we have followed a rigorous process to ensure we have chosen the right company for our customers. This transaction protects our customers, reduces our risk exposure and is aligned with our strategy, ensuring focus and resources can be directed towards sustained key growth areas of the business".
-ENDS-
For further information: |
|
Charles Taylor plc |
|
David Marock, Group Chief Executive Officer |
|
Mike Lord, Group Communications Director
| Via Redleaf Communications |
Redleaf Communications | ct@redleafpr.com |
Charlie Geller Susie Hudson | 020 7382 4730 |
Notes to editors
Charles Taylor plc is a leading provider of professional services to clients across the global insurance market. The Group has been providing services since 1884 and today employs around 1,700 staff in 71 offices spread across 28 countries in the UK, the Americas, Asia Pacific, Europe, the Middle East and Africa.
The Group offers services, principally on a fee-based model and operates through three businesses - Management, Adjusting and Insurance Support Services. Charles Taylor also owns life insurers, creating value through select acquisitions and operational efficiency.
Further information is available at www.ctplc.com.
Statements made in this announcement that look forward in time or that express management's beliefs, expectations or estimates regarding future occurrences are "forward-looking statements" within the meaning of the United States federal securities laws. These forward-looking statements reflect the Group's current expectations concerning future events and actual results may differ materially from current expectations or historical results.