Weinberg deals Pru a stake in St James's Place

Sir Mark Weinberg crystallised another fortune from the life assurance business yesterday, reversing the J Rothschild insurance company he founded six years ago into his quoted vehicle St James's Place Capital. The 65- year-old, South African-born entrepreneur and Rothschild's two other founders will receive more than pounds 2m each when they sell part of their combined pounds 35m holding in the enlarged company to the Prudential.

The linked deals, which Sir Mark described as the completion of a process that started with last year's separation of St James's life assurance interests from former business partner Lord Rothschild's investment activities, will also give up to 60 founder "partners" in J Rothschild shares worth about pounds 150,000 each.

For the Pru, the acquisition by tender of a 29.9 per cent stake in St James's Place for pounds 39.6m represents a move into the upper end of the personal financial services market, bringing it closer to J Rothschild's wealthy client base. It has made an assurance not to increase its stake for at least a year and has said it agrees that St James should remain independently managed and maintain a separate stock market listing.

It is the second time Sir Mark has grown and then cashed in on a life assurance business, having sold Hambro Life to BAT in the early 1980s. His personal stake in J Rothschild amounts to almost pounds 12m. His co-founders, Mike Wilson and Keith Carby, have similar holdings.

Sir Mark said yesterday the catalyst for the complex deal was the recent pounds 2.9bn takeover by the Prudential of Scottish Amicable, which joined forces with St James's Place Capital in 1991 to form J Rothschild Assurance and remained a significant shareholder. The takeover meant the Pru's stake in St James rose from around 3.5 per cent to around 22 per cent. By tendering for further shares it plans to take its holding to the maximum allowable under takeover panel rules without being forced to make a full offer.

Nine-month figures yesterday showed J Rothschild growing its life assurance business almost twice as fast as the rest of the market. New business grew by 39 per cent last year compared with just 24 per cent for a comparable spread of Association of British Insurers members.

Mike Wilson, chief executive, said that outperformance reflected the high quality of Rothschild's sales force, where employees had an average 11 years' financial services experience and were required to have worked in the industry for at least three years before joining.

After rapid growth during its short existence, Rothschild now sells more new policies than Britannic and United Assurance and two thirds as many as Abbey Life and Scottish Amicable itself.

Following the reverse takeover, about three-quarters of St James's Place's business will be represented by the J Rothschild operation, with the rest accounted for by Life Assurance Holding Corporation, a vulture fund set up to buy and close down ailing life insurers, and Global Asset Management, an institutional fund manager.

On the basis of St James's closing share price yesterday of 131p, up 5.5p, the enlarged company will be valued at pounds 562m.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Sport
Adnan Januzaj and Gareth Bale
footballManchester United set to loan out Januzaj to make room for Bale - if a move for the Welshman firms up
Arts and Entertainment
Lena Headey as Cersei Lannister in Game of Thrones
film
News
i100
Sport
Yaya Sanogo, Mats Hummels, Troy Deeney and Adnan Januzaj
footballMost Premier League sides are after a striker, but here's a full run down of the ins and outs that could happen over the next month
News
Nigel Farage celebrates with a pint after early local election results in the Hoy and Helmet pub in South Benfleet in Essex
peopleHe has shaped British politics 'for good or ill'
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Selby Jennings: VP/SVP Credit Quant- NY- Investment Bank

Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...

Selby Jennings: Quantitative Research | Equity | New York

Not specified: Selby Jennings: Quantitative Research | Global Equity | New Yor...

Selby Jennings: SVP Model Validation

Not specified: Selby Jennings: SVP Model Validation This top tiered investment...

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

Day In a Page

War with Isis: The West needs more than a White Knight

The West needs more than a White Knight

Despite billions spent on weapons, the US has not been able to counter Isis's gruesome tactics, says Patrick Cockburn
Return to Helmand: Private Davey Graham recalls the day he was shot by the Taliban

'The day I was shot by the Taliban'

Private Davey Graham was shot five times during an ambush in 2007 - it was the first, controversial photograph to show the dangers our soldiers faced in Helmand province
Revealed: the best and worst airlines for delays

Revealed: the best and worst airlines for delays

Many flyers are failing to claim compensation to which they are entitled, a new survey has found
The stories that defined 2014: From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions

The stories that defined 2014

From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions
Stoke-on-Trent becomes first British city to be classified as 'disaster resilient' by the United Nations

Disaster looming? Now you know where to head...

Which British city has become the first to be awarded special 'resilience' status by the UN?
Finally, a diet that works: Californian pastor's wildly popular Daniel Plan has seen his congregation greatly reduced

Finally, a diet that works

Californian pastor's wildly popular Daniel Plan has seen his congregation greatly reduced
Say it with... lyrics: The power of song was never greater, according to our internet searches

Say it with... lyrics

The power of song was never greater, according to our internet searches
Professor Danielle George: On a mission to bring back the art of 'thinkering'

The joys of 'thinkering'

Professor Danielle George on why we have to nurture tomorrow's scientists today
Monique Roffey: The author on father figures, the nation's narcissism and New Year reflections

Monique Roffey interview

The author on father figures, the nation's narcissism and New Year reflections
Introducing my anti-heroes of 2014

Introducing my anti-heroes of 2014

Their outrageousness and originality makes the world a bit more interesting, says Ellen E Jones
DJ Taylor: Good taste? It's all a matter of timing...

Good taste? It's all a matter of timing...

It has been hard to form generally accepted cultural standards since the middle of the 19th century – and the disintegration is only going to accelerate, says DJ Taylor
Olivia Jacobs & Ben Caplan: 'Ben thought the play was called 'Christian Love'. It was 'Christie in Love' - about a necrophiliac serial killer'

How we met

Olivia Jacobs and Ben Caplan
Bill Granger recipes: Our chef's breakfasts will revitalise you in time for the New Year

Bill Granger's healthy breakfasts

Our chef's healthy recipes are perfect if you've overindulged during the festive season
Transfer guide: From Arsenal to West Ham - what does your club need in the January transfer window?

Who does your club need in the transfer window?

Most Premier League sides are after a striker, but here's a full run down of the ins and outs that could happen over the next month
The Last Word: From aliens at FA to yak’s milk in the Tour, here’s to 2015

Michael Calvin's Last Word

From aliens at FA to yak’s milk in the Tour, here’s to 2015