Cinven pays £275m for Aegon’s Guardian arm

DUTCH financial services group Aegon has sold its North West-based Guardian closed life insurance business to private equity firm Cinven for £275m.

Guardian, which employs 160 people in Lytham in Lancashire, will be used by Cinven as a springboard into financial services.

Aegon, which owns Scottish Equitable, said it expects the deal will complete by the end of the year. The staff at Guardian are expected to remain in Lytham, where Aegon will continue to emply more than 400 people in its individual protection business, which sells life assurance and critical illness cover

Guardian, which manages over 300,000 life insurance policies in the United Kingdom, has been closed to acquiring new business since 2001.

Aegon said its asset management arm had entered into a long-term agreement with Cinven and will continue to manage the assets of Guardian which total £7.4bn.

Jan Nooitgedagt, Aego’s chief financial office said: ““Consistent with actions over the past three years to dispose of, or run-off, certain businesses deemed non-core, Aegon has concluded that managing the closed business of Guardian companies no longer fits with our strategic objectives.

““We remain committed to the United Kingdom and to maximizing the opportunities of Aegon’s chosen markets, Workplace Savings and At Retirement, which includes individual protection.”

The book value of the Guardian business amounted to £271m as per June 30, 2011. Underlying earnings before were £23m in 2010.