UPDATE 1-Legal & General seeks more acquisitions in 2014

Wed Mar 5, 2014 4:12am EST

Related Topics

* To raise full-year dividend 20 pct to 9.3 per share

* Ups direct investment portfolio in yr to 2.9 bln stg

By Chris Vellacott

LONDON, March 5 (Reuters) - British life insurance and pensions provider Legal & General Group Plc hopes to maintain the momentum of acquisitions and direct investments in infrastructure set in 2013 through the coming year, its management said.

Speaking after the group unveiled a 16 percent increase in net cash generation for 2013, Chief Executive Nigel Wilson said he is seeking to buy an annuity business in the United States, having already acquired an investment firm.

Last month L&G said it had bought Global Index Advisors, an Atlanta-based investment firm running $15.6 billion in assets.

"We would like to be bigger in America ... We've been looking at annuity acquisitions in the States. That's an area of focus," he said on a conference call, stressing any deals would be modestly sized "bolt-ons".

L&G has a strategic focus on series of global trends, such as ageing populations, countries scaling back welfare provision and the retrenchment of banks since the financial crisis.

It is an enthusiastic investor in British infrastructure, focusing on areas such as transport, energy, housing and hospitals, since such assets offer steady, inflation-linked returns from road tolls and rents, matching long term liabilities to retirees.

The group increased its direct investment portfolio during the year to 2.9 billion pounds from 1.4 billion, adding a further 300 million since the start of 2014. Wilson said he expected to announce further investments across the UK during the year.

The group also announced a one-fifth hike in its full-year dividend to 9.3 pence per share, a move welcomed by analysts at brokerage Bernstein Research, though they noted the 7 percent rise in L&G's operating earnings was short of expectations.

L&G shares were trading more than 2 percent lower by 0840 GMT.

"This is a good set of results although operating profits missed consensus, driven by lower earnings from protection (insurance) and auto enrolment," Bernstein said.

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