Australia’s AMP exits life insurance with $389 mln stake sale

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The AMP Ltd logo decorates its head office located in central Sydney, Australia, May 5, 2017. Photo taken May 5, 2017. REUTERS/David Gray // File Photo

(Reuters) – Australia’s AMP (AMP.AX) said on Wednesday it had agreed to sell its remaining 19 percent stake in Resolution Life’s Australia business to the British firm, signaling the wealth manager’s exit from life insurance.

The stake sale will fetch A$524 million (US$389.28 million) and comes years after the Australian company agreed to offload its life insurance arm to Resolution Life at a discounted price of A$3 billion.

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At that time, AMP decided to receive some consideration of the transaction in the form of a stake in the company.

AMP said the sale would boost its available capital by A$459 million, ahead of plans to separate the asset management arm’s private markets business in the first half of next year.

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Resolution Life and AMP have also agreed to settle amendments and other claims following the deal that would see the Australian company pay a net A$141 million.

AMP will receive A$65 million in one payment in fiscal year 2021 after payment.

(1 dollar = 1.3461 Australian dollars)

Additional reporting by Savyata Mishra in Bengaluru; Edited by Aditya Sony

Our Standards: Thomson Reuters Trust Principles.

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