Australian insurer Suncorp has agreed to sell its wealth business Suncorp Portfolio Services to Queensland-based superannuation fund LGIAsuper.
The total consideration for the acquisition, which is expected to close next year, is estimated at A$45m.
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Suncorp Portfolio Services provides superannuation and retirement products. The unit oversees A$6.4bn in funds as of 30 December 2020.
Suncorp Group CEO Steve Johnston said the sale agreement is a good outcome for the group’s 137,000 superannuation members and would further simply the group’s portfolio.
Johnston said: “When I was appointed CEO, I said I wanted to align everyone at Suncorp around improving the way we deliver for our insurance and banking customers.
“This approach is already delivering results, and the Wealth sale will allow the Bank team to focus exclusively on the priorities we outlined at the interim result in February.”
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By GlobalDataSuncorp banking and wealth CEO Clive van Horen added: “After extensive engagement with a number of potential acquirers, we believe that LGIAsuper is best placed to deliver sustainable member outcomes.
“The values and purpose of LGIAsuper, which is also headquartered in Queensland, align closely with those of Suncorp. This transaction will also enable the combined business to take advantage of size and scale benefits.”
LGIAsuper said the deal will increase the size and scale of its fund and allow the company to deliver greater efficiencies while bringing down operating costs and fees.
Earlier this week, a report said that Dutch insurer NN Group is weighing the sale of its asset management business which manages over $363bn (€300bn) in assets.
