Chesnara has agreed a deal to acquire MetLife UK (MLUK), the insurer's closed-book UK life insurance company.

The European life and pensions consolidator will acquire 100 per cent of the company's share capital.

The proposed transaction covers only MLUK's closed-book business and does not include MetLife's UK protection operations, which will continue to be run by the insurer.

The transaction is expected to complete during the first half of 2027, subject to regulatory approvals.

MLUK closed to new business in 2017 and manages a portfolio of unit-linked investment policies with optional guarantees and variable annuities for around 18,000 customer policies and £1.7bn in assets under administration.

Chesnara said the transaction is expected to generate around £90m in lifetime cashflows, with about half emerging in the first five years after completion, and to increase both Own Funds and Contractual Service Margin by approximately £45m.

The transaction is expected to have a broadly neutral impact on Chesnara’s Solvency II ratio, with the final impacts to be determined at completion, subject to customary adjustments.

Chesnara Group chief executive, Steve Murray, commented that as Chesnara’s fourth acquisition in the past two years, it “adds further scale and diversification to their UK business as well as an estimated £90m of lifetime cashflows”.

He described MLUK’s closed-book portfolio as “an excellent fit” with their existing UK operations.

He added: “We continue to see a healthy pipeline of M&A opportunities.”

Chesnara confirmed that MLUK has an existing external reinsurance arrangement with a European reinsurer that will remain in place following transaction completion.

The policies of MLUK are already administered by to SS&C Technologies, Chesnara’s existing UK outsourcing partner.

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