The Canada Life Group (U.K.) Limited has announced that it has reached an agreement to acquire financial services provider Retirement Advantage in order to push into the equity release market. Equity release, the borrowing of money against the value of one’s home, is becoming popular in the UK, with £2 billion of housing wealth accessed in 2016.
Retirement Advantage was created in 2015 when funds managed by TDR Capital LLP merged the retirement income and equity release divisions of MGM Advantage and Stonehaven. The company has over 30,000 pension and equity release customers, and more than £2 billion of assets under management including a £1.5 billion block of in-force annuities (as of 30 June 2017).
Doug Brown, Executive Vice-President and Chief Executive Officer, Canada Life U.K., said “Canada Life has operated in the UK since 1903 and is a highly regarded provider of retirement income, investment and employee protection solutions. This transaction enhances our position and broadens our product suite to include equity release mortgages.” The terms of the transaction were not disclosed.
“This transaction reaffirms our organization’s commitment to the United Kingdom and will further strengthen Canada Life’s position as a leading insurer in the UK,” said Paul Mahon, President and Chief Executive Officer of Great-West Lifeco,an international financial services holding company that wholly owns The Canada Life Group (U.K.) Limited.
Craig Fazzini-Jones, Group Chief Executive, Retirement Advantage, said, “This acquisition is a positive endorsement of the business plan we adopted following the UK pension reforms announced in 2014 that transformed our business and drove the creation of innovative retirement solutions. As we join Canada Life, we will be well positioned to build upon that success and provide greater retirement protection for our customers.”
The transaction is expected to close in the fourth quarter of 2017 and is subject to customary regulatory approvals, and certain closing conditions. Regulatory approval is likely to take between three and six months, during which time it will be business as usual for the companies and their customer service.
