Phoenix (PHNX) has confirmed it is in advanced talks with Deutsche Bank linked to the proposed purchase of the German finance house's UK insurance business, Abbey Life Assurance. Acquisitions are crucial to the life assurance consolidator's long-term ability to grow its cash generation and support dividend payments.
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In June, management announced plans to purchase Axa Wealth's pension and protection businesses, a deal set to complete before the end of the year. As a result, management expects to increase the 2016 final dividend by 5 per cent to 28p, or 56p on an annualised basis. To support this the group has a cash generation target of between £350m and £450m for the full year and a longer-term goal of £2bn between 2016 and 2020.
