Legal & General Group has agreed to acquire the entire share capital of closed annuity buyout company Lucida, for an estimated £151m.
The acquisition by L&G Group’s subsidiary, Legal & General Assurance Society, from LCM Holdings means the group will take on Lucida’s £1.4bn portfolio of annuity assets.
L&G said the estimated cash consideration of £151m will be funded from surplus capital held within the group. The deal is expected to complete in Q3 2013, subject to Prudential Regulation Authority and Financial Conduct Authority approval.
Legal & General managing director, annuities, Kerrigan Procter said: “We identified retirement solutions as one of our five themes for growth, and I’m delighted today to be able to announce our first acquisition in this arena.
“This acquisition will benefit Lucida’s customers, by providing them with the comfort of knowing their pensions will be paid by a longstanding, trusted and well capitalised business.”
Legal & General’s annuity business has more than 700,000 customers and manages more than £33bn in assets.
Lucida was founded in 2006 to focus on the bulk purchase annuity market. It implemented bulk annuity arrangements with the Merchant Navy Officers Pension Fund, New Ireland Assurance and the UK pension schemes of Morgan Crucible and Newell Rubbermaid.
However, the firm, currently responsible for more than 31,000 pensions in payment, closed to new business in November 2012.
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