ReAssure Group, a UK-based subsidiary of re/insurance major Swiss Re, has agreed to acquire the UK closed book business of British wealth manager Quilter for £425m ($515m).

Under the terms of the contract, Quilter, erstwhile Old Mutual Wealth, will sell its heritage life and pensions division Old Mutual Wealth Life Assurance (Quilter Life Assurance) including subsidiary Old Mutual Wealth Pensions Trustees.

As a result of the deal, nearly 200,000 policies, £12bn ($14.5bn) of assets, along with 300 staff will be transferred to ReAssure.

ReAssure CEO Mark Hodges said: “I am delighted to announce our latest acquisition. We have a long history of value, creating transactions, and today’s announcement is further evidence of our ability to grow our business.

“We provide an attractive solution to vendors who value our expertise, execution capability, and that we have a strong track record in customer service. Today’s acquisition is a win for all stakeholders.

“Customers will migrate onto our ALPHA platform and receive excellent service, Quilter has execution certainty, and our shareholders will benefit from substantial synergies and attractive returns.

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“This transaction further confirms that our business is well-positioned to benefit from the significant and structurally growing market opportunity in closed books. Our deal pipeline is attractive, and we will continue to focus on our growth strategy.”

The transaction, which is scheduled to be completed by the end of 2019, will boost future cash generation potential for ReAssure.

In June, Swiss Re confirmed that its UK subsidiary ReAssure Group is preparing to launch a $4.5bn initial public offering (IPO) to collect the required funds for expansion.

However, Swiss Re announced in July that it would abort the $4.5bn initial public offering (IPO) of its UK subsidiary ReAssure Group in response to the “heightened caution and weaker underlying demand” from large institutional investors.