Aegon Reviews Sale of UK Insurance Unit

Aegon discusses a divestment of £2bn in the face of consolidation growing in the UK insurance and pensions sector.

Aegon's UK insurance and workplace pension business has attracted takeover interest from several major industry players as the Dutch insurer considers a potential £2bn sale. It is reported that Phoenix Group, Royal London, and Scottish Widows are some of the companies looking at the potential as well as preliminary interest in private equity houses such as CVC.

Goldman Sachs is currently handling the sale process and bids will be available within the next few weeks. Aegon has been revising its UK insurance business since late last year, forming part of a wider strategy to increase it in the US life insurance market. As a part of such a transition, the group intends to rename itself to the Transamerica brand and move its headquarters to the US in two years.

The UK business of Aegon has access to circa 3.7 million customers, and they control around PS220bn of assets towards its culmination by the conclusion of 2024 with just under 2,500 employees. The insurer has explained that its UK asset management division will not be covered by any transaction with reference to the strategic nature of maintaining the asset management fee earnings in the face of relatively low insurance margins.

This review is placed against the background of significant merger and acquisition activity in the UK insurance industry in the recent past, with some of the deals being Zurich, Aviva, Chesnara, and HSBC Life UK. Industry observers see Aegon's potential divestment as another signal of accelerating consolidation within insurance and pension markets.