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Just Retirement and Partnership agree merger

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  • 11/08/2015
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Just Retirement and Partnership agree merger
Annuity and life provider Just Retirement has agreed to merge with Partnership, a life insurer, annuity and equity release provider with completion expected in December this year.

The new group to be named JRP Group, which holds a 5% share of UK annuity transactions in 2015 will hand Just Retirement shareholders 60% of the split with 40% going to Partnership post-completion. The valuation was based on business contributions and share performance in recent months.

Rodney Cook, former CEO at Just Retirement, becomes group chief executive of The Group Board and staff will be drawn from both companies.

The merger follows a market rollercoaster after the annuity changes announced in the 2014 Budget, which took the industry by surprise and heralded plummeting annuity sales.

Partnership’s results, published today, revealed that in the first six months of the year, new business sales of individually written annuities were £128m compared to £334m in the first half of last year.

Just Retirement’s results, published in May, showed that total annuities were down 15% compared with the nine months ending 31 March 2014, to £874.6m. As expected, this was driven by weaker individually underwritten annuity volumes, down 59% to £380.3m.

However, both companies report increasing individual annuity quote activity in H2 2015 and say the enlarged firm will create a stronger competitor against insurers in the UK retirement income market. The firm also has expansion plans in South Africa and the U.S.

New products and service launches from both since the Budget include Just Retirement’s simplified advice service, flexible pension plans and other ‘income for life solutions.’ It said the group will be able to deliver “improved customer outcomes through better value individually underwritten products and projected individually underwritten products based on medical and/or lifestyle factors will become an increasingly prominent part of the retirement income market.”

Chris Gibson-Smith, chairman of Partnership, said: “I am delighted to announce the recommended all-share merger of Just Retirement and Partnership. Both businesses have at their core a focus on using outstanding intellectual property and underwriting expertise to deliver better value products and improved customer outcomes within defined benefit, UK retail retirement income and international markets. This transaction represents a unique opportunity to accelerate the existing strategy of both businesses, which we believe will allow us to deliver better returns to both policyholders and shareholders.”

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