* Plans to apply for credit rating by year-end - finance
* First-half oper profit 266 mln stg vs 186 mln stg
* Keeps interim dividend unchanged at 26.7 p per share
(Adds details, Finance director comments, share movement)
By Roshni Menon
Aug 21 Phoenix Group Holdings, whose
business model involves buying life insurance funds that are
closed to new customers and running them more efficiently, said
it would seek an investment-grade credit rating as it had
simplified its debt structure and reported a 43 percent jump in
A credit rating - issued by rating agencies Standard and
Poor's, Fitch and Moody's - would help Phoenix reduce the cost
of its senior debt by about 50 basis points, get longer
maturities, and access to wider group of investors.
"We will start the engagement with the agencies between now
and the turn of the year. We expect, hopefully, to complete the
process in the first half of next year," Group Finance Director
Jim McConville told Reuters.
Phoenix said companies usually seek credit ratings from at
least two agencies.
Heavy debt had forced Phoenix into a financial restructuring
and a two-year hiatus from the buyout market until early 2013,
when it renegotiated repayment of 2.3 billion pounds in debt.
Phoenix Group, formerly known as Pearl Assurance, sold its
asset management business in March, helping it pay down 250
million pounds of debt and focus on its life insurance business.
Post the sale, a bond issue and restructuring of loans last
month, Phoenix's senior debt has reduced to 1.2 billion pounds
from 1.7 billion pounds at the start of the year.
Group operating profit rose to 266 million pounds ($441
million) in the six months ended June 30, from 186 million
pounds a year earlier.
Phoenix said the operating profit included 114 million
pounds from "management actions", an increase from 24 million
pounds on that basis in the same period last year.
However, shares in the company fell about 1.5 percent in
early trading as Phoenix kept its interim dividend unchanged at
26.7 pence per share.
"In our view, the dividend discussion is somewhat of a
zero-sum game - management could clearly pay out more, but would
then need to raise more from shareholders for future M&A,"
Berenberg analysts said in a note.
The stock was trading down 0.5 percent at 711.5 pence at
1036 GMT on the London Stock Exchange.
($1 = 0.6034 British pounds)
(Reporting by Roshni Menon in Bangalore; Editing by Ted Kerr
and Gopakumar Warrier)