AMP has announced a revised agreement with Resolution Life, with updated terms, for the sale of AMP Life, which is now expected to complete in 1H20 subject to regulatory approvals in Australia, New Zealand and China.
The company reported in July that it was having challenges with the agreement meeting the condition precedent for Reserve Bank of New Zealand (RBNZ) approval (see: AMP Life Sale Uncertainties…).
AMP stated the revised agreement delivers a consideration of A$3 billion comprising:
– A$2.5 billion cash; and
– A$500 million equity interest (expected to be around 20 percent) in Resolution Life Australia, a new Australian-domiciled, Resolution Life-controlled holding company that will become the owner of AMP Life
The company noted that policyholder interests have been paramount throughout the transaction and all customers terms and conditions will remain unchanged.
“AMP and Resolution Life are engaging constructively with regulators in New Zealand and Australia and are continuing to work productively with the Reserve Bank of New Zealand to address their requirements for change in control,” it stated.
It added that the AMP Limited Board had assessed the revised transaction terms from Resolution Life against alternative options which included: retention, demerger of AMP Life and the separation and sale of individual AMP Life business units.
The Board concluded that the sale of AMP Life delivers the best outcome for policyholders, the company and its shareholders.