Aviva plc (“Aviva”) today announces that it has agreed to sell its entire 80% shareholding in the Italian life insurance joint venture, Aviva Vita S.p.A. (“Aviva Vita” or the “Company”), to its partner UBI Banca (the “Transaction”). The Transaction represents another important strategic milestone as Aviva delivers on its commitment to refocus its portfolio.
On completion, Aviva will receive c.€400 million in cash consideration. The Transaction represents a multiple of 8.4x Aviva Vita’s 2019 IFRS profit after tax, 1.0x Solvency II Own Funds at 30 June 2020 and 1.2x net asset value at 30 June 20201. In addition, a subordinated loan of €40 million provided by Aviva Italia Holding S.p.A. to Aviva Vita, will be repaid in full at completion.
The Transaction would increase Aviva’s net asset value as at 30 June 2020 by £0.12 billion, strengthen Aviva’s Solvency II capital surplus by £0.22 billion and increase its Solvency II coverage ratio on a shareholder basis by approximately 4 percentage points. In 2019, Aviva Vita’s IFRS profit after tax was £523 million and it did not pay a dividend. The gross assets of Aviva Vita were £16.32 billion as at 30 June 2020.
The proceeds will be used to further strengthen Aviva’s central liquidity and will be considered as part of Aviva’s broader capital management and debt reduction objectives.
Customers of Aviva Vita will continue to deal with the Company as usual and there is no impact to customer policies as a result of this announcement. The Transaction is subject to customary closing conditions, including regulatory approval, and is expected to complete in the first half of 2021.
Aviva has three other operating insurance entities in Italy:
- Aviva SpA, a 51% owned life insurance joint venture with UniCredit (2019 Solvency II Own Funds of €0.8 billion4)
- Aviva Life SpA, a 100% owned life insurance entity (2019 Solvency II Own Funds of €0.2 billion)
- Aviva Italia SpA, a 100% owned general insurance entity (2019 Solvency II Own Funds of €0.2 billion)
Aviva continues to evaluate how it manages these businesses to maximise shareholder value.
Amanda Blanc, Chief Executive Officer of Aviva, said:
Our strategy is about focus and delivery. The sale of Aviva Vita is another important step forward as we reshape our portfolio and follows the recent announcement of the majority sale of our Singaporean business. We will continue to be decisive as we seek to transform Aviva for the benefit of our shareholders.
Notes:
1. Multiples presented on a 100% basis
2. Translated into GBP at 30 June 2020 spot rate of 1.10
3. Translated into GBP at 2019 average rate of 1.14
4. Figures represent 100% of Aviva SpA
-ENDS-
Enquiries:
Media:
Andrew Reid
+44 (0)7800 694 276
Sarah Swailes
+44 (0)7800 694 859
Analysts:
Diane Michelberger
+44 (0)20 7662 0911
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 19.2 million (as at 31 December 2023) 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 www.aviva.com/climate-goals 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 31 December 2023, total Group assets under management at Aviva Group were £376 billion and our estimated Solvency II shareholder capital surplus as at 31 March 2024 was £8.5 billion. Our shares are listed on the London Stock Exchange and we are a member of the FTSE 100 index.
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