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Shares in newly formed JRP Group fall 3% on first day

Shares in newly formed JRP Group fall 3% on first day

JRP Group, the new company born of a merger between annuity providers Just Retirement and Partnership, saw its share price take a tumble on the first day of trading.

Shares in the company had a rocky first day, falling from an opening price of £1.53 to £1.48 over the course of trading, a drop of 3.3 per cent.

JRP began trading on the London Stock Exchange with a market cap of £1.4bn and assets under management of more than £15bn, the company said.

Despite the share price fall Barrie Cornes, an insurance analyst with Panmure Gordon, said has a buy recommendation for the new company.

He said: “The merger has been a long-time coming. I think the outlook for the new company is positive. We think the shares are under valued and both companies were trading at a discount.

“Both companies are performing well in the bulk annuity space and the individual annuity space is not dead, despite what many people think.”

April’s pension reforms have had a significant effect on the sale of annuities, with sales falling by 42 per cent from £11.9bn in 2013 to £6.9bn by the end of June 2014, according to data from the ABI.

When the merger was announced in August the two companies said it would allow them to “tackle the challenges” posed by the recent reforms.

Both companies are floated on the Aim and following the 2014 Budget Partnership’s share price plummetted 60 per cent, falling from £3.19 to around £1.22 by the end of that week.

Just Retirement’s shares took a similar nose-dive, falling 48 per cent from £2.67 to £1.40.

Rodney Cook, chief executive of JRP Group, said: “As we launch, we are optimistic that our new company will use the outstanding intellectual property we have developed, together with our multi-channel distribution assets and market leading service to positively disrupt markets to deliver improved value to our customers.”