Resolution to buy AXA's UK life assurance business for £2.75 billion
24 June 2010
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.