Phoenix in talks to buy Deutsche Bank’s Abbey Life

LONDON: Phoenix Group Holdings, Britain’s largest owner of life insurance funds closed to new customers, said on Friday it was in advanced talks to buy Deutsche Bank AG’s British insurance business, Abbey Life Assurance. Deutsche Bank has been weighing the sale of Abbey Life since October, sources had told Reuters, as Germany’s largest lender restructures its business amid increasing regulation, negative interest rates and a competitive home market.

“This is a substantial business and we are buying it if we get the opportunity,” Phoenix CEO Clive Bannister told Reuters. “That is our intent and clearly it’s subject to all sort of things that may or may not happen.” He declined to comment on whether the company was raising funds and also the deal size. Deutsche Bank was nearing a deal to sell the business to Phoenix, with the latter planning to raise 800 million pounds ($1.06 billion) to fund the purchase, a person close to the matter told Reuters on Thursday. Deutsche Bank declined to comment yesterday. Bannister had told Reuters in August that the company was scouting for acquisitions to help gain scale in a challenging, low-interest-rate environment following Britain’s vote to leave the European Union. “To us, this deal could be the making of Phoenix as an acquisition vehicle for closed life funds and we eagerly await details if it does, indeed, proceed,” said Eamonn Flanagan, an analyst at Shore Capital. Abbey Life, bought by Deutsche Bank for 977 million pounds in 2007, is valued at about 1 billion pounds, sources told Reuters in June.