The purse strings have finally been loosened at Phoenix (PHNX) after subsidiary Pearl Life agreed to buy Axa Wealth's pension and protection business. The closed-book life assurance consolidator will pay a cash sum of £375m for the business, which will add £12.3bn of assets under management and more than 910,000 policies.
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Management expects the purchase to generate £300m in cash flows from this year until 2020 and £200m from 2021 onwards. Phoenix should also benefit from £250m in net capital synergies within six months of completion. As a result, management plans to increase the dividend by 5 per cent to 28p a share for the full year.
