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LONDON, Sept 18 (Reuters) - Legal & General has agreed to sell its UK housebuilder CALA Group in a deal worth 1.35 billion pounds ($1.78 billion) to an acquisition vehicle led by U.S. private assets firm Sixth Street Partners, as the latter steps up its European investment drive.
The British life insurer will receive cash proceeds of 1.16 billion pounds, of which around 500 million pounds will be paid at closing with the remaining consideration paid over the next five years on a deferred non-contingent basis.
The sale comes shortly after L&G unveiled a tightened approach to capital allocation and a decision to create a corporate investments unit at its capital markets event in June.
The company also said it could use some of the proceeds to increase returns to shareholders through ongoing buybacks.
"This transaction demonstrates continued momentum in executing our strategy, simplifying our portfolio to enable a sharper focus on our core, synergistic businesses," António Simões, L&G CEO said in a statement.
In June,
Reuters reported
Sixth Street had embarked on the biggest European recruitment drive in its 15-year history, leasing a new regional headquarters in London's Mayfair and adding up to 20 employees this year for a push into private credit and real estate.
Julian Salisbury, co-chief investment officer of the $75 billion global investment firm - which counts a number of ex-Goldman Sachs stars among its leaders - said he looked forward to working with co-investor Patron Capital to support CALA's ongoing growth.
($1 = 0.7598 pounds)
(Reporting by Sinead Cruise in London and Yadarisa Shabong in Bengaluru; Editing by Nivedita Bhattacharjee)
((Yadarisa.Shabong@thomsonreuters.com; +91 9742735150;))
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