Old Mutual is planning to sell its Nordic business Skandia Insurance Company to Skandia Liv, for a gross cash consideration of GBP2.1bn.

The sale includes Old Mutual’s long-term savings and banking operations in Sweden, Denmark and Norway operating under the Skandia brand.

Swedish life insurer Skandia Liv, currently an independent subsidiary of Skandia AB, will operate independently from its parent following the deal.

Old Mutual CEO Julian Roberts said that this Transaction represents a material step in the execution of our restructuring programme. They intend to use the proceeds from the sale to accelerate the reduction in group borrowings and to return surplus capital arising from the Transaction to shareholders.

"The Transaction will also enable us to reduce complexity within the Group consistent with our stated strategy and to focus more sharply on those parts of our Long-Term Savings business," added Roberts.

The transaction is expected to complete at the end of the first quarter of 2012.