The deal values Partnership at about £668.5 million. The Just Retirement board said it expected the merger to result in pre-tax cost savings of at least £40 million per year, with the full run-rate being achieved in 2018. One-off integration costs of £60 million over two years have been forecast.

The statement suggested there would be job losses. The boards said they “anticipate that this will involve headcount reduction” and have begun “integration planning” but full details are yet to be finalised.

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A statement to the Stock Exchange today read: “Just Retirement today announces its intention to raise equity share capital by way of a fully underwritten placing and open offer. Separately today, Partnership Assurance Group has also announced an underwritten placing of 39,995,997 new Partnership Assurance Shares representing approximately 9.99 per cent of Partnership Assurance's current issued ordinary share capital.

“It is intended that the two equity capital raisings will raise in aggregate net proceeds of approximately £150 million, which is consistent with the intention which was announced by Just Retirement in the announcement of its proposed merger with Partnership Assurance released on 11 August 2015.

“The net proceeds of the capital raise will allow the combined group to cover expected non-recurring integration costs of approximately £60 million and transaction costs of approximately £20 million; provide further comfort over the transition to Solvency II; and support future growth initiatives and product development.”

The companies expect the deal to accelerate new product launches.

The companies said: “This is of critical importance given the greater expectation of new products among customers following the freedom and choice introduced by the 2014 pension reforms.”

Rodney Cook will be group chief executive, while David Richardson will be deputy group chief executive officer and Simon Thomas the group finance director.