Standard Life Aberdeen PLC proposed to return up to £1.75 billion of capital to its shareholders following completion of the sale of its capital-intensive insurance business to Phoenix Group Holdings.
Under the plan, the asset manager will issue £1 billion of new B shares, which it will subsequently redeem for cash, and repurchase up to £750 million of shares. The firm said its board anticipates lower capital requirements following the £3.24 billion sale of its insurance business.
The share scheme will be accompanied by a share consolidation, and both will be conducted after deal completion and remain subject to regulatory approvals.
The share buyback program, meanwhile, will be conducted after the B share scheme and share consolidation, subject to regulatory approvals and market conditions.
The remaining proceeds from the Phoenix deal, together with Standard Life Aberdeen's existing liquidity, will be used to retire a portion of its outstanding debt of £1.9 billion and to support investments and other general corporate purposes.
The Phoenix deal, the full details of which will be set out in a circular to be released May 30, and the proposed capital return are expected to be approved at a June 25 general meeting, the company said May 29.
