Aegon has agreed to sell its UK operations to Standard Life in a £2bn ($2.7bn) deal, as the Dutch financial services group sharpens its focus on expanding in the US life insurance and retirement market.
The transaction marks the completion of Aegon’s strategic review of its UK business and supports its plan to become a more US-centred life insurance and retirement group.
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Aegon CEO Lard Friese said: “The transaction represents an important step in our ambition to become a leading US life insurance and retirement group.”
The company is already in the process of relocating its headquarters and legal seat from the Netherlands to the US, a shift that will ultimately see it adopt the Transamerica name by 1 January, 2028.
Aegon’s move reflects the growing importance of its US operations, which account for about 70% of the group’s business through its Transamerica franchise.
Under the agreement, UK-based Standard Life will acquire the whole of Aegon UK, combining the two companies’ pensions and savings operations into a business serving 16 million customers with around £480bn ($651bn) in assets under administration.
The consideration comprises £750m ($1bn) in cash and a 15.3% stake in Standard Life, equivalent to 181.1 million shares.
Aegon said any remittances taken from Aegon UK between signing and completion would reduce the cash portion of the deal.
For Aegon, the disposal frees up capital as it pushes ahead with its US strategy.
The company said cash proceeds, after considering expected remittances before closing, are set to be used for a combination of deleveraging and share buy-backs.
The sale is expected to complete near the end of 2026, subject to regulatory approvals and other customary conditions.
Following completion, Aegon will be restricted from selling its Standard Life shares until the earlier of 18 months after closing or the completion of its move to the US.
It will also have the right to nominate one non-executive director to Standard Life’s board.
Aegon said its UK asset management operations will remain part of its global asset management business and will continue to serve as an asset management partner to the enlarged group.
For Standard Life, the acquisition is expected to increase group operating cash generation by £160m ($217m) a year.
Standard Life CEO Andy Briggs said: “With financial wellbeing at the heart of everything it does, Aegon UK’s values and culture are aligned with our own. Together, we will not only be stronger, we will be better – helping our customers achieve better outcomes and greater financial security in later life.”
The company also expects recurring pre-tax cost synergies of £110m ($149m) annually, with more than half to be delivered by the end of 2029 and the remainder by the end of 2031.
