Company News: Pact, Challenger
Pact announced a new CEO. Mr Sanjay Dayal’s past roles included senior management positions with BlueScope Steel and Orica / ICI. We view this appointment as a positive step – Pact is currently under-earning off its assets. We expect this well-credentialed appointment to turn the operational (and subsequent financial) performance of Pact, through accelerating operational improvement programs, taking steps to improve margins, and continuing to improve the company’s cost base.
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Challenger announced an extension of its agreement with Japanese company MS&AD. It will sell ¥50 billion (~A$640m) of USD and AUD denominated annuities per year for a minimum of five years into the Japanese market, via Mitsui Sumitomo Primary Life Insurance Company (MS Primary) (a subsidiary of MS&AD). This agreement increases the volume of annuity sales and extends into USD denominated annuities (previously AUD only).
In addition, MS&AD intends to increase its shareholding in Challenger to 15% (currently 13.85%), and will nominate a director to join the company’s Board.
This announcement was well received by the market.
- Fleur Graves