Tuesday 25 April 2017

Sale of Anglo's wealth management division stalled

Anglo's wealth management unit, which manages assets worth about €500m, opened the books to potential buyers in early March and has appointed Hawkpoint to handle the businesses sale. Photo: Getty Images
Anglo's wealth management unit, which manages assets worth about €500m, opened the books to potential buyers in early March and has appointed Hawkpoint to handle the businesses sale. Photo: Getty Images
Laura Noonan

Laura Noonan

WOULD-be buyers of Anglo Irish Bank's wealth management division are not expected to submit first bids until the end of May after "technical issues" temporarily delayed the sales process.

The news comes as the sale of Quinn Healthcare enters its final phase, with Irish Life & Permanent believed to be the fore-runner of the remaining bidders.

Anglo's wealth management unit, which manages assets worth about €500m, opened the books to potential buyers in early March and has appointed Hawkpoint to handle the businesses sale.

It is understood that the sales process was briefly stalled pending the resolution of "technical issues" with the Department of Finance but has now cranked up again.

Insurance, banking, wealth management and private equity companies from Ireland and abroad are believed to be "actively engaged" in the sales process.

Bidders

Sources said the shape of any deal would not become apparent until the end of May, when first round bids are made and so-called 'tyre kickers' are sifted from serious bidders.

The wealth management division has about 2,500 clients and about €50m in cash, but its sales price is likely to be inconsequential against the scale of Anglo's €29bn to €34bn bailout.

Meanwhile, Irish Life & Permanent is believed to be willing to pump as much as €100m into a deal that would see the bancassurer take over Quinn Healthcare.

Much of the cash is expected to be left in the health care business, with the remainder ultimately going to creditors of the Quinn Group.

While Quinn Healthcare is regulated as an intermediary and outsources all its underwriting activity to Quinn Insurance, the healthcare business may have some liability for future claims.

This liability could drive a demand for the health company's new owner to put additional cash into the business.

A spokesman for Irish Life declined to comment on the structure or likelihood of any deal. Irish Life is believed to be minded to go ahead with the deal even though parent company IL&P is facing into a major cash crisis after being ordered to raise €4bn to boost its capital.

The plc is planning to sell off Irish Life Assurance in a stock market flotation later this summer to help fund the €4bn demand.

Quinn Healthcare would fit into the life insurance business and could make it more valuable, since Irish Life would be able to offer a fuller suite of products to companies already buying pension policies.

Irish Independent

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