The Royal London group has entered in to an agreement with funds advised by independent private equity firm Vitruvian Partners to support a management-led buyout of Royal London's offshore arm 360° and its subsidiaries for an undisclosed sum.
The 360° executive management team, led by chief executive David Kneeshaw, will remain unchanged. Following completion, the company will be re-branded "RL360°".
RL360° will be further strengthened through support from the global reinsurance group Munich Re, as well as an element of long term financing from Royal London, and in addition to capital from Vitruvian.
RL360° was established in 2009 through the merger of Scottish Life International and Scottish Provident International.
The company offers a broad range of offshore investment, savings and tax planning products to investors based around the world. It manages funds in excess of £2bn.
There will be no job losses as part of the sale.
Royal London chief executive Phil Loney said:"Royal London group has been approached on several occasions with proposals for the purchase of RL360° and we had a duty to our members to explore any potential financial benefits from these transactions.
"None of these previous approaches were capable of being fulfilled. However, the Royal London board has concluded that the proposal put forward by the RL360° management team does make compelling financial and strategic sense for all parties.
"It allows Royal London to focus on the development of our core businesses in the UK and Ireland. For RL360° it gives access to additional long-term investment that will allow them to fulfil their ambitions in both the UK and international markets.
"A management-led buyout at this point in the development of RL360° reflects the strength of the mutual model and our ability to take a long-term approach in developing thriving businesses. The time is now right to realise a return on our investment for RLG and its members."
RL360° chief executive David Kneeshaw said:"The entire management team at RL360° are extremely excited that Royal London has agreed to our proposals for a management-led buyout, backed by Vitruvian.
"We have built a strong business since we merged in 2009 with clear strategic direction, a compelling product range and a service-driven team on the Isle of Man and around the world to support our customers and distributors.
"We believe this transaction is the first of its type in the offshore life space and it allows us to follow a long-term plan with the capital stability we require to continue to expand our business internationally and enhance our platform linked approach with the UK.
"We remain fully committed to our existing products, markets, partners and customers. Once the transaction is completed we will move swiftly to realise RL360°'s existing growth plans".
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From 6 April 2019