UK buyout fund Resolution Ltd, headed by insurance tycoon Clive Cowdery, today said it has agreed to acquire the UK life assurance business of French insurer AXA SA, for £2.75 billion ($4.1 billion).
London-based Resolution, which bought its peer Friends Provident in 2009 for £1.9 billion after being rebuffed twice (See: British insurers Friends Provident and Resolution to merge), has been in talks with Axa for over a month after Axa indicated that it was willing to sell some of its UK businesses. (See: Resolution Plc in talks to buy Axa's UK life business for about £2.8 billion)
Under the deal, Resolution will buy Axa's UK annuity, protection and group pension businesses by paying £2.25 billion in cash and up to £500 million in deferred consideration notes issued to Axa and through bank debt.
The acquisition will be financed by a pre-emptive £2.055 billion rights issue and an acquisition facility of Â£400 million.
Resolution will absorb about 2,200 Axa employees.
Resolution said today that the acquisition of the Axa UK Life Business is a logical next step in its UK Life Project.