Zurich agrees to sell platform and Horizon funds to Embark

Zurich UK has entered into an agreement to sell its retail wealth business to Embark Group for an undisclosed sum.

The transaction includes Zurich’s retail wealth platform business, including its authorised corporate director, and investment management business, including its five Zurich Horizon multi-asset funds.

As part of the deal, Zurich and Embark have entered into a five-year partnership agreement to develop and deploy leading-edge digital life and protection products through Embark’s technology and distribution channels.

The decision is in line with Zurich’s commitment to concentrate investment on its core retail and group protection franchise, where it has invested heavily in recent years.

Jim Sykes, Zurich’s head of UK life, said: “This is an excellent outcome for all parties. Although our wealth platform is a strong and successful business, we believe the needs of customers and advisers would be better served by an owner that is focused on investing in this specialist area.

“Embark is ideally placed to take the platform to the next stage in its development. In turn, this allows us to focus our resources on our protection business where we see the greatest growth opportunities. We are excited by our new retail protection partnership with Embark, which is a further signal of our intent in this market.”

Phil Smith, Embark Group chief executive, said: “This acquisition is perfectly aligned to our growth strategy and duly establishes Embark as a significant player in the UK retirement and savings market.

“The deal brings considerable assets, demonstrable distribution and investment capabilities, and most importantly one of the best teams in the industry to Embark.

“We are also excited by the potential of our new digital partnership with Zurich UK, and the future innovations we will bring to the market through it. This deal takes Embark's group assets under administration to well in excess of £33bn as we continue to disrupt the UK investment savings and platform market.”

The transaction includes Zurich’s retail wealth platform business (Sterling ISA Managers Limited) and its Authorised Corporate Director (ACD) and Investment Management business (Zurich Investment Services (UK) Limited), with assets under administration totalling c.£11bn and >130,000 advised clients.

Zurich’s wealth platform has performed strongly since its launch six years ago, attracting billions of pounds in flows and winning multiple awards for its functionality. Its five risk-rated, multi-asset Horizon funds are among the top performers in their sectors.

As part of the transaction c.110 Zurich employees are expected to transfer to Embark under a TUPE arrangement.

The acquisition is subject to the customary regulatory approvals and is expected to close in the second quarter of 2020.