Quilter is looking to sell its international business, Quilter International, to insurer Utmost Group for £483m.
The sale has been unanimously agreed by the Quilter board and will allow the group to focus on its UK wealth management business.
The £483m price tag is inclusive of a 5 per cent interest charge on the base consideration of £460m from January 1, 2021. This assumes a completion of December 31, 2021 and a price to 2020 Solvency II Own Funds multiple of 0.84x.
Quilter now awaits regulatory approval from various jurisdictions to finalise the sale.
Quilter International, the Isle of Man-based investment platform for cross-border investments for UK residents, had £21.8bn of AUM as of December 31, 2020.
A sale of this unit has been considered since a strategic review of the business was initiated in December 2020 following a management reshuffle.
“[The sale] allows us to focus on accelerating our growth and efficiency plans as well as further simplifying and focusing our business on its core UK high net worth and affluent customer proposition,” said Paul Feeney, CEO of Quilter.
“It also gives us the ability to deliver a further meaningful capital distribution to shareholders. With the recent completion of our platform transformation programme, we are set up for strong growth.”
Following the sale, Quilter will target client cash flow growth and expects to deliver an operating margin of at least 25 per cent in 2023 (growing to 30 per cent in 2025).
A portion of the net cash proceeds from the sale, around £450m, will be used to accelerate this growth while an allocation will also be used as a dividend for Quilter International shareholders.
Quilter will also recommence the return of the residual £200m of proceeds from the Quilter Life Assurance sale, with an initial tranche of £50m of the next £100m of regulatory approved buyback expected to commence shortly.
Jon Yarker is a freelance reporter for FTAdviser