Phoenix Group sees bumper profits from recent acquisition

Phoenix Group has generated £486m of income in the past year, bolstered largely by their acquisition of Axa’s pensions business.

This acquisition contributed a healthy £117m to PGH Capital PLC’s income since it’s acquisition of Axa’s pensions and protection businesses in November last year.

Last may, Axa had decided to sell it’s arm of their British investment, pensions and protection businesses, selling Axa Wealth and Sunlife to Phoenix as it pulls out of the UK insurance market, the third largest of it’s kind in Europe.

Phoenix’s objectives consisted of attaining a cash income of between £350m and £450m in 2016, which it exceeded largely due to their recent acquisition.

In a statement released by the Phoenix Group this morning, the company “reiterates” that it will grow further, producing “at least £250m of cash” within the six months it has acquired Axa’s British insurance assets.

Last month in December, Phoenix repaid the complete total of the £182m bank debt used to finance the Axa acquisition.

Meanwhile, Phoenix’s £935m acquisition of Abbey Life Assurance in September last year left a revolving credit facility of £250m for PGH Capital PLC, increasing it’s size from £650m to £900m.

The firm paid £50m of this credit facility back last month, leaving £850m outstanding as of the end of last year.

Proposing a debt issuance, Phoenix Group hopes to reduce their outstanding bank debt further.

Regarding PGH Capital PLC’s future strategy, the group has mandated a series of credit investor meetings in London for Citigroup Global Markets Limited, JP Morgan Securities PLC, Lloyds Bank PLC, Merrill Lynch International and the Royal Bank of Scotland PLC; talks will be commencing 12th January.