European private equity firm Cinven has completed its acquisition of Guardian Financial Services, the UK closed book of life and pensions business. Cinven reached agreement to acquire Guardian from AEGON in August 2011 for an enterprise value of GBP275 million.
The transaction was originated by Cinven’s Financial Services team as part of its analysis of the European life assurance market.
The investment provides a consolidation platform for Cinven in the European closed life assurance market driven by factors including the fragmented nature of the market; commercial pressures on smaller operators; banking institutions looking to exit insurance assets and overseas insurers seeking to recycle capital. This strategy would create benefits for shareholders and policy holders through greater efficiencies and de-risking funds.
In the Financial Services sector, Cinven’s acquisition of Guardian follows the recent US$300 million equity investment in Avolon, the Cinven-backed international aircraft leasing group, from the Government of Singapore Investment Corporation (GIC). Avolon successfully completed its initial capital raise from Cinven, along with CVC Capital Partners and Oak Hill Capital Partners, in May 2010, and has now raised equity capital totalling US1.4 billion.
