LONDON (Alliance News) - IFG Group PLC Thursday said it has agreed the sale of its Irish pension and advisory business to Willis Ireland, part of Willis Group Holdings, for up to EUR13.5 million, as the group focuses on its James Hay Partnership and Saunderson House businesses.
James Hay Partnership is a platform provider in the retirement and wealth planning market. Saunderson House is a financial advisor to high net-worth clients.
In a statement, IFG said it will receive EUR11.5 million on completion of the sale and up to EUR2.0 million in contingent deferred consideration, payable following the second anniversary of the sale and dependent upon revenue of the new combined business over that period. The sale price also depends on an adjustment upon finalisation of the completion accounts.
"The sales proceeds will further strengthen our balance sheet and facilitate investment in [James Hay Partnership and Saunderson House]," Chief Executive Paul McNamara said in a statement. "IFG is now a more sharply focused group with well-positioned businesses and the resources to pursue increased growth in our core markets."
The group also said it is in advanced discussions over the disposal of general insurance businesses ARB and Insure4Less, the remaining businesses in the Irish segment.
IFG made the disclosure along with interim results for the six months ended June 30, which showed a fall in pretax profit to GBP2.2 million from GBP3.0 million in the corresponding period last year.
Revenue increased to GBP34.1 million from GBP31.7 million, but an increase in cost of sales resulted in a fall in gross profit to GBP5.9 million from GBP6.9 million. Combined, administrative and other expenses decreased to GBP3.5 million from GBP3.7 million.
"With strong management, profitable businesses and a clear strategic opportunity, we believe IFG Group is positioned for growth and improved financial performance in the second half of 2014 and into 2015. The investments in the business have driven growth in clients and assets and we expect this to translate into improved profitability in 2015," IFG said in a statement.
IFG maintained its interim dividend at 1.65 cents per share.
IFG shares were Thursday untraded at 129.25 pence.