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Canadian investment group Brookfield has struck a £2.4bn deal to acquire life insurer Just Group, in the latest acquisition of a London-listed business.
Brookfield Wealth Solutions, the group’s insurance arm, said on Thursday that it planned to merge Just Group with its UK operations Blumont, and that the two would operate under Just Group’s brand.
Just’s share price rose 68 per cent on Thursday morning to 212p, close to the 220p offered by Brookfield.
The deal for Just will accelerate Brookfield’s push into the UK’s pension risk transfer market, in which companies pay insurers to take over their obligations to pensioners. It comes amid a string of deals by North American private capital groups to access the hot market.
Chancellor Rachel Reeves on Thursday welcomed the deal, saying it reinforced “the fact that the UK remains one of the best places in the world for business”.
Reeves’ public endorsement came just days after the government dropped Brookfield from an expected role in the financing of the new Sizewell C nuclear power plant in Suffolk.
People close to the decision said it had angered Brookfield. But Reeves’ allies insisted the chancellor’s welcome for the Brookfield acquisition of Just Group was not an attempt to repair relations with the group. One said: “It’s nothing like that. The chancellor often welcomes big inward investment announcements.”
The takeover of Just is the latest in a series of take-private deals for UK-listed groups, which has fuelled concerns over the health of the London stock exchange and a hollowing out of public equity markets.
Brookfield first entered the UK’s pension risk transfer or bulk annuity market in March by setting up a new business under the Blumont brand.
British companies are expected to offload about £500bn of retirement obligations over the next decade and the more than £1tn assets backing them to insurers through these deals, as they wind down defined benefit pension schemes.
Brookfield’s cash offer represents a 75 per cent premium to Just’s closing share price on Wednesday evening, valuing the London-listed company’s equity at £2.4bn. Just’s board has recommended that shareholders accept the offer.
Earlier this month, Athora, an insurer backed by US private capital group Apollo, agreed a £5.7bn takeover of pension risk transfer specialist PIC. A week later, Legal & General announced a new partnership worth up to $20bn with US alternative assets giant Blackstone, which will help supply assets for L&G’s annuities business.
“The market could become less competitive” following the acquisition, Charlie Finch, a partner at pensions specialist consultancy LCP, told the Financial Times.
To date, L&G, PIC and rival Rothesay have won all of the UK pension buy-in deals larger than £2bn, he said.
Just, which specialises in deals with smaller pension schemes, increased sales in its DB pension risk transfer business to £5.4bn in 2024, up 57 per cent compared with the previous year. In November, it completed its largest transaction to date, a £1.8bn pension risk transfer with the G4S pension scheme.
Brookfield has invested more than £60bn into the UK, its second-largest investment market, including into Canary Wharf Group and Center Parcs.
The combined business would be run by Just’s current management and headquartered in London, Brookfield said.
With additional reporting from George Parker in London
