Chesnara plc (CSN.L, CSN.AQ), a Life and Pensions Consolidator, on Tuesday agreed to acquire Scottish Widows Europe SA from Scottish Widows Limited, a subsidiary of Lloyds Banking Group plc (LLOBF, LYG, LLOY.L), for total cash consideration of 110 million euros.
The deal completion is expected around end-2026.
The Luxembourg-based closed life insurance business has 1.7 billion euros of assets under administration and around 46,000 in-force policies.
The acquisition is expected to generate approximately 250 million euros of cash over the lifetime of the portfolio, with about 100 million euros anticipated in the first five years.
The deal's consideration of 110 million euros represents 0.64x the full year 2024 Own Funds of 173 million euros.
The transaction will be fully funded from internal cash resources, including proceeds from the company's 150 million pounds RT1 bond issued in August 2025.
Pro-forma Solvency II coverage ratio is estimated at 173% as at December 31, 2024, remaining above the group's normal operating range of 140% to 160%. Leverage is expected to remain below the long-term target of 30%.
On Monday, Lloyds Banking Group closed trading 1% higher at 101.40 pence on the London Stock Exchange.
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