The Royal London Group (RLG) has entered into an agreement with funds advised by independent private equity firm Vitruvian Partners to support a management-led buyout of Royal London 360° (RL360°).
RLG is confident that the transfer of ownership will enable RL360° to achieve its strategic vision through a further acceleration of the growth that RL360° has experienced in recent years.
The RL360° executive management team, led by chief executive David Kneeshaw, will remain unchanged. Following completion, the company will be re-branded.
RL360° will be further strengthened through support from the global reinsurance group Munich Re, as well as an element of long term financing from RLG, and in addition to capital from Vitruvian.
RL360° was established in 2009 through the merger of Scottish Life International and Scottish Provident International. The company offers a broad range of offshore investment, savings and tax planning products to investors based around the world. The company has combined industry experience of over 35 years, and manages funds in excess of GBP2bn.
There will be no job losses as part of the sale.
Phil Loney (pictured), chief executive of the Royal London Group, says: “RLG has been approached on several occasions with proposals for the purchase of RL360° and we had a duty to our members to explore any potential financial benefits from these transactions. None of these previous approaches were capable of being fulfilled. However, the RLG board has concluded that the proposal put forward by the RL360° management team does make compelling financial and strategic sense for all parties.
“It allows the RLG to focus on the development of our core businesses in the UK and Ireland. For RL360° it gives access to additional long-term investment that will allow them to fulfil their ambitions in both the UK and international markets.
“A management-led buyout at this point in the development of RL360° reflects the strength of the mutual model and our ability to take a long-term approach in developing thriving businesses. The time is now right to realise a return on our investment for RLG and its members.”
Kneeshaw says: “The entire management team at RL360° are extremely excited that RLG has agreed to our proposals for a management-led buyout, backed by Vitruvian. We have built a strong business since we merged in 2009 with clear strategic direction, a compelling product range and a service-driven team on the Isle of Man and around the world to support our customers and distributors.
“We believe this transaction is the first of its type in the offshore life space and it allows us to follow a long-term plan with the capital stability we require to continue to expand our business internationally and enhance our platform linked approach with the UK.”
Stephen Byrne, partner at Vitruvian, says: “We are delighted to be backing such a strong management team, with considerable assets under administration already, but also a great growth strategy. This is exactly the sort of investment we look for, a scalable services business addressing a global market opportunity.”
