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Dale, Osmond team to buy £1bn life funds

TDR Capital and Sun Capital Partners are the equity sponsors of Life Company Investor Group’s £1.025bn purchase of HHG’s closed life assurance funds.

TDR Capital and Sun Capital Partners are the founders and equal equity sponsors of  Life Company Investor Group (LCIG), the investment vehicle set up to bid for four closed life insurance funds that are being sold by HHG, the UK financial services company. LCIG has announced a £1.025 billion (€1.45 billion; $1.92 billion) deal to acquire the funds.

London-based TDR is the private equity firm run by Manjit Dale, the former DB Capital Partners executive, and Stephen Robertson. Sun Capital is a vehicle controlled by high profile UK entrepreneur Hugh Osmond.

According to a source familiar with the transaction, Dale and Osmond have spent the last four years planning an acquisition in the life assurance sector and looking for suitable assets.

The pair worked together in 1998 when they acquired 1,428 UK pubs from Bass to form Punch Taverns. In 1999, Punch was sold to Texas Pacific Group, the US private equity group. According to TDR’s website, the deal generated a cash multiple of 11.3 times and an IRR of 368 percent.

According to a LCIG press release, the UK closed life fund sector comprises almost 70 funds, with more than£190 billion of assets at the end of 2003. As long-term investors, LCIG was committed to using the HGG assets to build a “leading force in the UK savings industry.”

Financial advisers to Sun Capital and TDR are ABN AMRO and Dresdner
Kleinwort Wasserstein
. Dresdner Kleinwort Wasserstein, ABN AMRO and HBOS are joint lead arrangers of the acquisition debt financing.

According to the Financial Times, the deal has yet to be ratified by the Financial Services Authority, the UK watchdog.