Just Group dives 15% after drumming up £380m in fundraising push

Pensions provider Just Group saw its shares crash on Thursday after it was forced into a £380 million capital raise.

The company, which was previously hammered by pensions freedom reform, suffered a share fall of 15% to 83.1p after unveiling plans to sell £80 million of new shares and raise £300 million in debt.

The company, which is regulated like an insurance company, is beefing up capital buffers and getting more firepower for deals after regulator the Prudential Regulation Authority changed the way it calculates equity release mortgages, which Just offers to customers.

The PRA change was less damaging than first thought — the authority had considered making the rules retrospective to take in business written many years ago — but it still hurts Just’s balance sheet.

Separately, it swung to a £86 million loss from £181 million profits last year after another accounting provision.

The firm has changed property assumptions “in light of the economic and financial uncertainty caused by Brexit”, which means it has to take an accounting charge on its mortgages.

Chief executive Rodney Cook said 2018 “has been a year of contrasts” because underlying operating profit was up 31% to £315 million.