Standard Life investors set for £1.75bn windfall

INVESTORS in Standard Life are on track to share a £1.75 billion windfall within the next three months after the life and pensions giant got the green light to sell its Canadian business.

Standard Life HQ Lothian Road, Edinburgh. Picture: Neil Hanna

The Edinburgh-based group said Canadian finance minister Joe Oliver had approved the £2.2bn deal with insurer Manulife, announced in September.

Under the terms, Manulife – which also owns US insurer John Hancock – will market Standard Life Investments’ funds across Asia, Canada and the US.

Investors, who backed the sale at a meeting in October, will receive 73p a share as part of the sale proceeds.

The payment is due to be made before 6 April, when new rules on the tax treatment of so-called special purpose share schemes will kick in.

Standard Life has about 1.3 million retail investors. A spokesman said the return to capital from the sale would average £491 for with-profits policy­holders, who were given shares on demutualisation in 2006.

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The firm is also planning to consolidate the number of shares in issue to prevent a fall in share value following the return of capital. Details are due with annual results on 20 February.

Standard Life established a presence in Canada more than 180 years ago. Operating profits at the division, which has about 2,150 staff and manages £30.1bn in assets, rose 17 per cent to £69m in the first half of 2014.

However, in a recent update, the Montreal-based firm said full-year operating profits will be lower than the £155m expected, “reflecting planned regular management actions which will now not be pursued”.