Friends Life Said to Hire Goldman for Sale of International Unit

Aug 22, 2014 7:01 pm ET

Aug. 23 (Bloomberg) -- Friends Life Group Ltd., the U.K. insurer created by Clive Cowdery, has hired Goldman Sachs Group Inc. to explore a sale of its international business, according to two people with knowledge of the matter.

Friends Provident International, which has offices in Hong Kong, Dubai and Singapore, could fetch about $750 million in a sale, said the people, who asked not to be identified because the information hasn’t been made public. No final decision has been made, they said. Representatives for Friends Life and Goldman Sachs declined to comment.

Friends Life is among U.K. insurers exploring asset sales. Chief Executive Officer Andy Briggs earlier this year sold the European wealth-management unit for as much as 356 million pounds ($590 million) to Blackstone LP and is doing a review of Sesame Bankhall Group Ltd., a financial-advisory company.

Friends Provident, with almost 7 billion pounds in assets under management, reported a 44 percent slump in the value of new business, a measure of future sales, in the first half of the year, citing “challenging market conditions.”

Friends Life said in May that it would miss its earnings target this year after Chancellor of the Exchequer George Osborne in his budget scrapped rules that pushed retirees to buy annuities with their pension savings. The shares have tumbled about 13 percent this year, erasing about 662 million pounds in market value, which is 4.4 billion pounds.

RSA Insurance Group Plc said yesterday that it agreed to sell its businesses in Singapore and Hong Kong after raising more than 600 million pounds from disposals in eastern Europe, Canada and China. Direct Line Insurance Group Plc is also in talks to sell its German and Italian operations.

The shares rose as much as 0.7 percent after the report, erasing earlier losses. They closed at 307.60 pence in London, up 0.2 percent on the day.