Business
Sale of US Protection; new strategic partnership
Sale of US Protection; new strategic partnership.
About this update from Legal & General Group Plc
[{"type":"text","content":"\n\nTHIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION\n \nL&G announces the sale of its US protection business to Meiji Yasuda, and the creation of a long-term strategic partnership, for a valuation of $2.3bn\n\n\n\n\n· \n\n\nLongstanding partner Meiji Yasuda has agreed to purchase L&G's US protection business and to establish a strategic partnership with L&G to grow the US Pension Risk Transfer business (taking a 20% interest in L&G's US PRT business) for a combined equity value of $2.3bn (£1.8bn[1])\n\n\n\n\n· \n\n\nMeiji Yasuda intends to acquire a c. 5% shareholding in Legal & General Group plc[2] and to build on its existing partnership with L&G in asset management\n\n\n\n\n· \n\n\nL&G anticipates an additional share buyback of £1.0bn following completion[3] and now expects to return the equivalent of c. 40% of its market cap to shareholders over 2025-2027 through a combination of dividends and buybacks\n\n\n\n\nL&G Group CEO, António Simões, and Group CFO, Jeff Davies, will host a virtual investor presentation at 9am this morning (Friday 7 February 2025). You can access the virtual call here and the presentation slides will be made available online shortly beforehand (at the same link).\nThe Transaction\nLegal & General Group Plc (\"L&G\" or the \"Group\") today announces that it has agreed the sale of its US insurance entity[4], comprising its US protection and US Pension Risk Transfer (\"US PRT\") businesses, to Meiji Yasuda Life Insurance Company (\"Meiji Yasuda\"), a Japanese mutual life insurance company, for an equity value of $2.3bn (£1.8bn) payable in cash at completion (subject to certain purchase price adjustments) (the \"Transaction\"). Following completion, Meiji Yasuda will own L&G's US protection business and have a 20% economic interest in its US PRT business, with L&G retaining 80% of existing and new PRT through reinsurance arrangements between L&G and Meiji Yasuda.\nUnder the terms of the Transaction, the equity value of $2.3bn represents a compelling multiple to estimated 2024 post-tax earnings.\nThe Transaction is expected to complete towards the end of 2025 and is subject to customary closing conditions and regulatory approvals.\nThe Group also announces the forma...