Aviva to commence £600 million share buy-back

Published: 01 May 2018

Aviva plc (“Aviva”) announces that it will commence a share buy-back of its ordinary shares for up to a maximum aggregate consideration of £600 million.

As outlined in its recent 2017 results, Aviva has significant excess capital and has committed to deploy £2 billion of this in 2018. The deployment includes £900 million of debt reduction, £500 million for bolt-on acquisitions (c£100 million already committed to the acquisition of Friends First in Ireland) and a £600 million ordinary share buy-back. 

The dividend yield on Aviva shares currently stands at 5.2%*, and with the dividend expected to grow further, the Board believes a buy-back is a compelling use of Aviva’s excess capital.

Aviva has entered into an agreement with Citigroup Global Markets Ltd ("Citigroup") to conduct the share buy-back programme on its behalf and to make trading decisions under the programme independently of Aviva. The programme will commence on 1 May 2018 and will end no later than 31 December 2018. Shares acquired by Citigroup under the agreement will be immediately sold on to Aviva and, to the extent permitted by law, such ordinary shares purchased will be cancelled.

Aviva has received regulatory approval for the buy-back from the PRA.

“Aviva has significant surplus cash and capital and we are deploying £2 billion productively in 2018. The £600 million buy-back,  together with our plan to repay £900 million of expensive debt maturing this year and invest in bolt-on acquisitions, will grow Aviva’s earnings, strengthen cashflow and improve debt ratios.”

Mark Wilson, Group Chief Executive Officer of Aviva plc

Note: Any purchase of Aviva ordinary shares contemplated by this announcement will be executed in accordance with Aviva’s general authority to repurchase ordinary shares granted by its shareholders on 10 May 2017, EU Market Abuse Regulation (596/2014), and Chapter 12 of the Financial Conduct Authority’s Listing Rules.

* Based on 2017 dividend per share of 27.4p, and the Aviva ordinary share price of 529p on 30.04.2018.

-ends-

Enquiries:

Media:

Nigel Prideaux
+44 (0)20 7662 0215

Andrew Reid
+44 (0)20 7662 3131

Sarah Swailes
+44 (0)20 7662 6700

Analysts:
Chris Esson
+44 (0)20 7662 8115

Diane Michelberger
+44 (0)20 7662 0911

Helen Driver
+44 (0)20 7662 3070

Notes to editors:

  • We are the UK's leading diversified insurer and we operate in the UK, Ireland and Canada. We also have international investments in India and China.
  • We help our 19.6 million (as at 31 August 2024) customers make the most out of life, plan for the future, and have the confidence that if things go wrong we’ll be there to put it right.
  • We have been taking care of people for more than 325 years, in line with our purpose of being ‘with you today, for a better tomorrow’. In 2023, we paid £25.6 billion in claims and benefits to our customers.
  • In 2021, we announced our ambition to become Net Zero by 2040, the first major insurance company in the world to do so. We are aiming to have Net Zero carbon emissions from Aviva’s operations and supply chain by 2030. While we are working towards our sustainability ambitions, we recognise that while we have control over Aviva’s operations and influence on our supply chain, when it comes to decarbonising the economy in which we operate and invest, Aviva is one part of a far larger global ecosystem. There are also limits to our ability to influence other organisations and governments. Nevertheless, we remain focused on the task and are committed to playing our part in the collective effort to enable the global transition. Find out more about our climate goals at at www.aviva.com/sustainability/climate and our sustainability ambition and action at www.aviva.com/sustainability.
  • Aviva is a Living Wage, Living Pension and Living Hours employer and provides market-leading benefits for our people, including flexible working, paid carers leave and equal parental leave. Find out more at https://www.aviva.com/about-us/our-people/
  • As at 30 June 2024, total Group assets under management at Aviva Group were £398 billion and our estimated Solvency II shareholder capital surplus as at 30 September 2024 was £7.6 billion. Our shares are listed on the London Stock Exchange and we are a member of the FTSE 100 index.
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