Saga PLC (LSE:SAGA) has entered exclusive negotiations with Ageas to establish a 20-year partnership for motor and home insurance.
Under the proposed agreement, Ageas will also acquire Saga's underwriting arm Acromas for £67.5 million.
Rumours of the partnership first circulated earlier this month.
The partnership aims to enhance both companies' service offerings in the over-50s insurance market.
“This proposed deal with Saga aligns perfectly with our strategy to profitably grow in UK personal lines and in creating powerful partnerships to the benefit of our customers,” said Ageas UK chief executive Ant Middle.
Ageas UK will operate Saga's motor and home insurance products, which generated gross written premiums exceeding £479 million in the year ending 31 July.
Saga's broking business, Saga Services Limited, will remain active and unaffected in its partnerships with Collinson for travel insurance and Bupa for private medical insurance.
The partnership is expected to go live by the end of 2025, with Ageas UK paying Saga £80 million at launch.
The transaction is subject to final agreement and regulatory approval, with completion of the Acromas sale anticipated in the second quarter of 2025.
Saga also released its first-half results today, showing revenue up 13% but losses before tax up 34% to £104 million.
Excluding goodwill impairments, Saga penned a profit before tax of £27.2 million.