The company is developing and launching a radical new proposition for the retirement income market that will be available early next year once the new regulations are in place. The company is optimistic about the opportunities in the market, and plans to launch a raft of new product developments and enhancements to existing products. These include developing blended retirement solutions, revising the investment proposition, and making product changes to the investment-linked Flexible Income Annuity.
As part of the repositioning, MGM Advantage has also confirmed it is aligning its cost base to anticipated lower sales of annuities during this period of uncertainty for the overall market, but is firmly open for business.
The business has also announced around 80 redundancies, which are roles aligned to the annuity business. The redundancies will be managed where possible through natural turnover and voluntary redundancy, but the company has confirmed it may also include compulsory redundancies.
Chris Evans, MGM Advantage said:
"It is clear that the changes proposed in the recent Budget create many challenges for the industry. We have a great track record of responding to change, and it has become second nature to us over the last few years to adapt to opportunities that arise. In the need to respond quickly and effectively, we will focus on what we do best, developing innovative retirement income solutions. Advisers and our customers will continue to receive support through this transformation of the at-retirement market.
‘In the interim, we need to align our cost base to our new business plan for the year. Although I am personally deeply saddened by any redundancy, I have a responsibility to lead the business into the best possible shape, ready for the opportunities created by the current market turmoil."
Brian Magnus, from investor TDR Capital commented:
"While the Budget has caused disruption in the market, we are fully supportive of MGM. With the benefit of the significant capital investment we have made, coupled with MGM’s expertise in developing innovative products like the Flexible Income Annuity, we are well placed to take full advantage of the attractive opportunities these changes present."
