Legal & General (LGEN.L) has engaged new consultants to assist its newly appointed CEO, Antonio Simoes, in implementing a significant strategic revamp of the British insurance giant, according to sources close to the matter as reported by Reuters.
The UK’s L&G Hires New Advisers To Help Its CEO Antonio Simoes
Industry experts anticipate that under Simoes’ leadership, previously an executive at Santander and HSBC, the FTSE 100 company may increase its focus on pension investments and international expansion.
In a strategic shift, L&G has opted for the services of the investment banking firm Robey Warshaw, noted for its partnership with former British chancellor George Osborne, to guide the company on various strategic concerns, including potential acquisitions and defence against activism.
This decision marks a transition from its previous adviser, Lazard, as per the information provided by two anonymous sources. Statements from L&G, Robey Warshaw, and Lazard on this matter were unavailable.
Furthermore, JPMorgan has been selected to provide advice on strategic matters, taking over from Bank of America as L&G’s joint corporate broker, with Barclays continuing in its role, according to one of the sources. Comments from Bank of America, Barclays, and JPMorgan on the update were not provided.
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Antonio Simoes, who assumed the CEO position two months prior, is poised to announce his inaugural financial results for L&G on March 6. Despite the anticipated strategic update, some analysts, including Thomas Bateman from Berenberg, believe that Simoes’ plans might not significantly depart from the strategies of his predecessor, Nigel Wilson.
Bateman highlighted the inherent challenges in pivoting the direction of such a substantial enterprise but noted the continued growth potential in bulk purchase annuities, a sector where L&G already has a strong foothold.
The British defined benefit pension schemes, looking to transfer some of their £1.3 trillion in liabilities to insurers, present a competitive landscape involving traditional insurance companies and new entrants like Brookfield.
Simoes is also expected to target expansion in international markets, focusing on regions such as Asia, Europe, and North America, recognising the potential in markets like China and the existing brand presence in North America.
While the likelihood of smaller strategic acquisitions remains high, the possibility of a more significant purchase, such as a private capital management firm, aligns with industry trends observed in companies like BlackRock and Amundi.
