Phoenix launches capital raising to help fund acquisition

The company said it will issue seven new shares at 518p each for every 15 existing shares. These will represent around 32% of the enlarged issued share capital.

Phoenix announced back in February that it had agreed to buy Standard Life’s insurance business for a total consideration of £2.9bn.

Chief executive Clive Bannister said at the time: "This is a compelling transaction for Phoenix, consistent with the group's stated strategy and acquisition criteria. The proposed acquisition establishes Phoenix as the pre-eminent closed life fund consolidator in Europe with more than 10m policyholders and supports a significant increase in Phoenix's cash generation."

On Tuesday, Standard Life said it plans to return as much as £1.75bn to its shareholders in the wake of the insurance arm sale.

At 0908 BST, the shares were up 0.9% to 779p.