Deals: Utmost Group is Buying Lombard International Assurance

Latest acquisition news from the Utmost Group;

Utmost Group plc (“Utmost Group” or “the Group”) has entered into an agreement to acquire Lombard International Assurance Holdings Sarl (“the Acquisition”), subject to regulatory and other approvals. The Acquisition encompasses Lombard International’s leading European
business. Lombard International will become a part of Utmost International, the international life assurance business of Utmost Group.

The acquisition of Lombard International will confirm Utmost International as a leading global provider of international life assurance and strengthens the Group’s position in key markets throughout Europe. It brings together two large-scale businesses with closely aligned operating
models and a shared commitment to serving our clients’ long-term financial needs. By combining the existing distribution partner relationships, deep local market knowledge and a complementary product suite, the Acquisition provides a strong platform for the Group to serve its clients and execute on its strategic ambitions.

Financial and Operational Benefits

– Confirms Utmost International’s Leading Market Position: The Acquisition will add £43bn of assets under administration and over 20,000 policies to Utmost International. On a combined basis at YE 2023, Utmost International would have had £100bn of assets under administration and over 210,000 policies, and would have written £6.4bn of new business.

– Operational Integration: Lombard International will continue to operate from Luxembourg with its existing suite of products. These will be distributed under the Utmost brand by a single combined global salesforce in parallel with Utmost’s existing products, maintaining the combined group’s existing distribution models.

Strong potential for efficiencies and value creation: The increased scale achieved through the Acquisition will enable the Group to identify opportunities for efficiencies and capital synergies. The Group will focus on leveraging the complementary capabilities of the combined entity to deliver value creation for stakeholders.

– Maintains balance sheet strength, resilience, and flexibility: The Group’s capital strength will remain strong. On a proforma basis, had the transaction completed on 31 December 2023, the Group would have had:

o An increase in Gross Solvency II EV from £2,386 to £3,150m;
o A Group Solvency Capital Requirement (SCR) Coverage Ratio of 173%, and;
o A Group leverage ratio of 29%, within our 20-30% target range.

– Financing Structure: The total consideration will be financed through a £200m bank loan, with the remainder covered by existing cash reserves.
– Transaction Timeline: Subject to regulatory approvals, the Acquisition is expected to complete by the end of 2024.

Commenting on the Acquisition, Paul Thompson, CEO of Utmost Group said:

“The acquisition of Lombard International marks an exciting milestone in Utmost’s journey, fortifying our European position and establishing us as a leading global provider of insurancebased wealth solutions. The combined strength of the merged Utmost International and Lombard International gives added scale to the Group. It will enable us to better serve our expanded international client base and distribution partners, utilising deep market insights, strong technical expertise and a broader portfolio of products.”