Life and pensions consolidator Chesnara is expecting to make more acquisitions in the UK as big firms are seen to discard businesses amid decreasing market uncertainty caused by regulatory changes.

 

In its 2016 financial report, Chesnara notes that there has been a recent gradual increase in closed book market activity in the UK, partially driven by reduced uncertainty regarding Solvency II and regulatory developments.

 

This will drive further consolidation, Chesnara says, with larger financial companies wanting to refocus on core activities and drop capital intensive life and pension businesses to release capital or generate funds.

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“I also remain optimistic that as the uncertainty created by matters such as Solvency II and the FCA Legacy Review reduces, the UK acquisition market will become more active,” said Chesnara chairman Peter Mason.

 

“I am confident that with our tried and tested acquisition track record and flexible funding strategy, Chesnara is well positioned to take advantage of future opportunities that meet our stringent assessment criteria,” he added.

 

The insurance-focused takeover specialist says it has the flexibility to accommodate a wide range of potential target books. Chesnara also boasted of strong financial foundations and investor support to push further its acquisition strategy.

 

Chesnara’s 2016 pre-tax profit slightly decreased to £40.7 million from £42.7 million in the previous year, hurt by lower interest rates and the lack of gains from its acquisition of Waard Group, a Dutch firm comprising three closed book insurance companies and a servicing business.