Standard Life mulls sale of £200m health unit

Published on Monday 8 March 2010 20:24

STANDARD Life has appointed an adviser to consider a sale and other options for its health insurance business, which could fetch £200 million.

Fenchurch Advisory Partners is understood to have been appointed to consider the options.

A disposal would be one of the first deals under chief executive David Nish, the former finance director who took over the running of the Edinburgh-based pensions and insurance giant from Sandy Crombie on 1 January.

Standard Life Healthcare is a profitable and well-run business that was a large player in the UK's relatively small private healthcare market, said Eamonn Flanagan, an analyst at Shore Capital.

"I am not surprised they are selling after disposing of Standard Life Bank. They appear to be streamlining their business and moving away from a composite model," he said.

Standard Life, which is due to report full-year results tomorrow, and Fenchurch both declined to comment.

The firm has already hailed the return of investor appetite, reporting a 38 per cent leap in UK sales to 2.88 billion over the final quarter of 2009.

Analysts are pencilling in operating profits of about 662m, down from 933m the previous year. The challenging beginning to 2009 left new business 10 per cent lower over the full year, at 10.1bn.

However, UK pensions business soared by 42 per cent over the final quarter, with demand shooting up for its DIY-style self-invested personal pensions, better known as Sipps.