News: AMP AMP To Sell Wealth Protection And Mature Businesses

Oct 25 (Reuters) - AMP Ltd (AMP) :

• AMP AGREES TO SELL WEALTH PROTECTION AND MATURE BUSINESSES
• ANNOUNCES INTENTION TO DIVEST VIA IPO NEW ZEALAND WEALTH MANAGEMENT AND ADVICE BUSINESSES
• DEAL FOR FOR TOTAL PROCEEDS OF A$3.45 BILLION
• TRANSACTION EXPECTED TO COMPLETE IN 2H 2019
• FOR CUSTOMERS, THERE WILL BE NO CHANGE TO THEIR EXISTING INSURANCE POLICY TERMS OR CONDITIONS
• INTENDS TO SEEK DIVESTMENT OF NEW ZEALAND WEALTH MANAGEMENT AND ADVICE BUSINESSES VIA INITIAL PUBLIC OFFERING IN 2019
• ENTERED BINDING REINSURANCE DEAL WITH SWISS RE FOR NZ RETAIL WEALTH PROTECTION PORTFOLIO, EXPECTED TO GET UP TO A$150 MILLION OF CAPITAL TO AMP
• AMP EXPECTS TO MONETISE ALL NON-CASH CONSIDERATION OVER TIME
• REINSURANCE AGREEMENT IS EXPECTED TO REDUCE NEW ZEALAND PROFIT MARGINS BY A$20 MILLION ON A FULL-YEAR BASIS
• AMP CAPITAL WILL ALSO JOIN RESOLUTION LIFE'S GLOBAL PANEL OF PREFERRED ASSET MANAGERS
• NEW RELATIONSHIP AGREEMENT ESTABLISHED WITH RESOLUTION LIFE AND AMP CAPITAL WILL CONTINUE TO MANAGE WEALTH PROTECTION AND MATURE AUM
• SIMPLIFICATION AND SEPARATION COSTS RELATED TO RESOLUTION LIFE SALE TRANSACTION ARE EXPECTED TO BE IN ORDER OF A$320 MILLION POST-TAX
• BUSINESSES HAVE FY18 PRO FORMA OPERATING EARNINGS OF ABOUT A$40 MILLION ON A STANDALONE BASIS
• REINSURANCE AGREEMENT WITH SWISS RE FOR NEW ZEALAND RETAIL WEALTH PROTECTION PORTFOLIO EXPECTED TO RELEASE UP TO A$150 MILLION OF CAPITAL TO AMP
• CONTINUES TO TARGET TOTAL FY18 DIVIDEND PAYOUT TOWARDS LOWER END OF DIVIDEND GUIDANCE RANGE OF BETWEEN 70 - 90 PER CENT OF UNDERLYING PROFIT
• AMP WILL EXCLUDE 2H 18 EARNINGS FROM DISCONTINUED BUSINESSES IN DETERMINING FY 18 DIVIDEND
• ADDITIONAL CAPITAL FROM TRANSACTION WITH RESOLUTION LIFE WILL FACILITATE REDUCTION IN AMP'S CORPORATE DEBT OF UP TO A$800 MILLION
• REINSURANCE AGREEMENT WITH SWISS RE IS EXPECTED TO REDUCE NEW ZEALAND RETAIL WEALTH PROFIT MARGINS BY A$20 MILLION ON A FULL-YEAR BASIS
• TO SELL AUSTRALIAN AND NEW ZEALAND WEALTH PROTECTION & MATURE BUSINESSES TO RESOLUTION LIFE FOR TOTAL CASH & NON-CASH CONSIDERATION A$3.3 BILLION