Legal & General Group (LGEN) Investor Update summary

Strategic rationale and transaction overview

• Sale of US protection business to Meiji Yasuda for $2.3bn aligns with a strategy of sharper focus, sustainable growth, and enhanced returns, unlocking value at close to 30 times earnings.

• Meiji Yasuda will acquire approximately 5% of Legal & General Group plc, reflecting confidence in the long-term vision and deepening the partnership.

• L&G will retain 80% economic interest in the US PRT business post-deal, leveraging combined US insurance assets of about $80bn.

• The transaction is expected to complete by the end of 2025, subject to regulatory approvals.

• US protection business, though high-performing, offered limited synergies and was divested after a strategic review.

Strategic partnership and growth

• Partnership with Meiji Yasuda will scale US PRT and asset management, including outsourcing investment management of US assets to L&G and co-investment in global private assets.

• Asset management business to benefit from incremental fee-based revenues and new co-investment flows.

• Ongoing focus on UK as core market, with retail business fully concentrated in the UK.

• Asset management and private markets remain key growth engines, with flexibility for organic and bolt-on acquisitions.

• L&G will update Retail business targets following the sale at a planned H2 2025 investor event.

Financial impact and capital allocation

• Transaction generates $2.3bn (£1.8bn) in cash proceeds, with over 50% of proceeds to be returned to shareholders, including a £1bn share buyback.

• £400m of proceeds allocated to support US PRT reinsurance and growth; remainder to asset management and growth opportunities.

• Over £5bn to be returned to shareholders over three years, about 40% of market cap, via dividends and buybacks.

• All investments must meet a 14% return on capital hurdle; unallocated capital may be returned to shareholders.

• Capital discipline and flexibility maintained, with ongoing review of non-core assets for potential exit.