Resolution sells stake in AmLife and AmFamily Takaful

Life insurance consolidation vehicle Resolution has sold its stake in AmLife and AmFamily Takaful to its joint venture partner AmBank Group of Malaysia.

The FTSE 100 company said it had disposed of its 30% interest in the insurance companies for 245m Malaysian Ringgits.

Resolution's operating business Friends Life will receive £50m following the sale and benefit of a currency hedge.

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Friends Life said following discussions with AmBank Group it had decided the sell its interest. They had concluded the business required a "greater level of short term investment and commitment to meet its growth potential than was appropriate for Resolution".

John Van Der Wielen, Chief Executive Officer (CEO) of Friends Life International Division, said: "As a result of the international strategic review, we have decided that the focus of the international division will be entirely on its two wholly-owned businesses, Friends Provident International and Lombard International Assurance.

"These businesses now have plans that generate improved profit and cash returns for the group. AmBank has been a great partner and I am confident they will continue to be successful."

Andy Briggs, CEO designate of Resolution, added it was in their best financial interests to dissolve the joint venture.

"We have enjoyed working with AmBank to build AmLife and AmFamily Takaful into successful ventures.

"Whilst acknowledging the potential of the businesses, and having re-evaluated the businesses against our financial management criteria, we have concluded the right course of action is to sell them back to our joint venture partner. We wish the AmBank team every success in the future."

Resolution's shares were up 0.12% to 251.00p at 09:17 Monday.

RD