The Board of Friends Ivory & Sime plc (“FIS”) announces that it has entered into a conditional agreement to acquire Royal & SunAlliance Investments (“R&SA Investments”), the UK asset management business of Royal
The Board of Friends Ivory & Sime plc (“FIS”) announces that it has entered into a conditional agreement to acquire Royal & SunAlliance Investments (“R&SA Investments”), the UK asset management business of Royal & SunAlliance Insurance Group (“R&SA Group”) for £240 million. At 31 December 2001, R&SA Investments managed a total of £36 billion of funds. As part of the transaction, FIS and R&SA Group have agreed terms under which FIS will become the investment manager, under an exclusive 10 year contract, of the UK life insurance and general insurance funds of R&SA Group.
Transaction Highlights
The transaction is expected to bring the following benefits to FIS:
• A doubling of funds under management from £34 billion to £70 billion
• Significant additional investment expertise through R&SA Investments’ award winning investment management team
• Reinforcing a track record of managing, on an outsourced basis, investment assets for insurance companies
• Significant additional and stable revenue stream
• Earnings enhancement in the first full financial year to 31 December 2003, after the amortisation of goodwill, excluding one-off transaction costs and assuming all cost synergies are realised in that year
Howard Carter, Chief Executive of FIS, said:
“This transaction is transformational for FIS in terms of scale, doubling our funds under management and, on that measure, propelling us into the top 10 active investment managers in the UK. We shall emerge with a top quality investment team, enabling us to deliver the level and consistency of long-term performance which our clients deserve. We shall also have an expanded platform for the development of our ISIS brand in the retail market.”
Commenting on the proposed transaction, Sir David Kinloch, Chairman of FIS, said:
“I am absolutely delighted that we have acquired these businesses. This deal brings us £36 billion of assets that are stable and represent a significant additional revenue stream for FIS. Furthermore, the transaction is expected to be earnings enhancing in the first full financial year and demonstrates the ambition that FIS has to grow its business profitably, for the benefit of the shareholders.”
Friends Ivory and Sime PLC