Chesnara PLC (LSE:CSN) said it has struck a deal to acquire the onshore individual protection line of business from Canada Life UK, adding life insurance and critical illness policies for roughly 47,000 customers.
The life and pensions consolidator said it had agreed to pay a consideration of £9mln as part of the reinsurance agreement, funded from its own cash, for the line, which was closed to new business in November 2022.
It expects a £23mln uplift to group economic value over the next decade, of which £7mln is expected in the first five years.
The impact on Chesara’s Solvency II ratio is expected to be broadly neutral.
Chief executive Steve Murray said the company continues to see “a range of M&A opportunities” in the market and is confident in its ability to finance and execute transactions on terms that are attractive to both sides.
He added: “I am pleased that a company as highly regarded as Canada Life has placed its trust in us to support these customers and look forward to working with the team going forward.
“This transaction, the fifth deal announced in the last two years, will add additional scale to our UK business and provides an attractive return on investment for our shareholders.”