PHOENIX Group yesterday said it was already half way towards meeting its cash targets for the full year after just 90 days, amid a push to cut debts and build a warchest for potential deals in the future.
The FTSE 250 listed insurer, which makes money off closed life insurance books, generated £235m in the three months to 31 March. It is hoping to create £500m to £550m by the end of the year.
The company announced a £390m deal during the quarter to sell fund management unit Ignis Asset Management, giving Phoenix a further £140m of fire power once a £250m loan facility is paid off, which did not factor in yesterday’s results. The deal will complete by the end of June.
Boss Clive Bannister said cash generation would be used to help the dividend, delever and augment its equity, with room for a potential acquisition of another closed insurance book after.
The company saw £6bn wiped off its share price in April after a botched announcement by regulators over plans to review the closed book life insurance business.
“We don’t know where [the review] is going but it will probably take nine months to a year before we know,” Bannister said.