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Standard Life shareholders set for £1.75bn windfall


Standard Life shareholders are set to receive a share of a £1.75bn windfall, after the insurance and investments company sold the Canadian side of its business to Manulife.

The sale of assets will mean that Standard Life will no longer retain their insurance and investments business within Canada. However, they will still work with Manulife to sell their products in Canada, the US and Asia.

Once the deal has been finalised during the first quarter of 2015, Standard Life will receive £4bn in cash. Shareholders of the company will then receive a share of £1.75bn, which is equivalent to 73p a share, and investors will have the opportunity to receive the proceeds as income or capital.

Additionally, there was more positive news for Standard Life investors as share prices increased by 10% following the sale. This was also on the back of a 12% increase in operating profits for the first half of 2014, which was largely due to an increased demand for auto-enrolment pensions.

Good news for shareholders

David Nish, the chief executive of Standard Life led the sale of the Canadian assets, alongside investment bank JP Morgan Cazenove.
Mr Nish explained his reasons behind the move, with the competitive landscape being one of the main factors.

He said that the highly competitive nature of the Canadian market was a big factor, but continued to argue that Manulife will be able to take advantage of their domestic position of strength to overcome these challenges.

He also said that shareholders are getting a good deal as they will receive “a significant amount of capital”.

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