LONDON – The insurer Friends Life Group said on Friday that it had agreed to sell its Luxembourg-based wealth management arm to the Blackstone Group for up to 356 million pounds, or about $610 million.
Blackstone, one of the world’s largest private equity firms, will initially pay £317 million for two Friends Life subsidiaries, Lombard International Assurance and Insurance Development Holdings, which focus on estate and succession planning for high net worth individuals in Europe and parts of Latin America and Asia.
Blackstone could pay as much as £356 million for the units, known jointly as Lombard, based on a contingent element of the deal tied to the value of the company’s assets under management or certain business thresholds in the future.
The deal is in line with Friends Life’s strategy to sell noncore assets and focus on its life insurance business in Britain and its hubs in Hong Kong, Singapore and the United Arab Emirates.
“This disposal further improves our cash coverage of the dividend and is in line with our strategy to maximize value from each part of the group,” Andy Briggs, the Friends Life chief executive, said in a statement. “It also allows us to deliver on our commitment to return cash to shareholders when it is appropriate to do so.”
Following the transaction, Friends Life, based on the Channel Island of Guernsey, said it intended to return about £261 million to shareholders through a share buyback program.
Shares of Friends Life had risen 0.8 percent to slightly less than £3.23 in trading in London on Friday morning.
The deal is subject to regulatory approval and is expected to be completed in the second half of 2014.
In 2013, Lombard posted an operating loss of £46 million and had assets under management of about £20.2 billion.
Friends Life, formerly known as Resolution, was initially formed in 2008 by British entrepreneur Clive Cowdery to buy underperforming insurance businesses. Mr. Cowdery left the company earlier this year.
It eventually combined Friends Provident with the majority of AXA’s British life insurance business and Bupa Health Assurance.
The company, which changed its name earlier this year, has more than five million customers, about 4,000 employees and manages funds worth more than £117 billion.
An earlier version of this article misstated the amount of assets Lombard has under management. It is about £20.2 billion, not £20.2 million.