(PRESS RELEASE) LONDON, 4-Mar-2021 — /EuropaWire/ — Aviva’s transformation to focus on its strongest businesses continues and thus announces its exit from Italy with the sale of its remaining Italian Life and General Insurance businesses (“Aviva Italy”) for €873m in cash.
This values the businesses at €1.2bn including Unicredit Group’s 49% shareholding in Aviva S.p.A.
- Sale of Aviva’s Life insurance business1 to CNP Assurances for €543m, and
- Sale of Aviva’s General insurance business2 to Allianz for €330m
- Collectively the transactions represent a multiple of 0.8x Solvency II own funds3 and 1.5x IFRS net asset value3 as at 31 December 2020
- Together with expected proceeds from the previously announced sale of our shareholding in Aviva Vita4 to UBI Banca, Aviva will realise over €1.3bn of cash from the sale of its insurance businesses in Italy
Amanda Blanc, Chief Executive Officer of Aviva, said:
“Since I announced our new strategy in August last year, we have announced seven divestments that will generate over £5bn of cash proceeds. This rapid progress allows us to focus on transforming and growing our already strong businesses in the UK, Ireland and Canada. The sale of our Italian operations to high quality buyers is a positive outcome for our customers, employees, distributors and shareholders. We promised that we would deliver quickly and we are. Our work to improve Aviva for the benefit of our shareholders continues.”
The estimated financial impact of the transactions5 on Aviva as at 31 December 2020, is:
- Increase of Solvency II capital surplus6 by c.£0.2bn and Solvency II cover ratio by c.7 percentage points
- Increase of excess capital above 180% Solvency II cover ratio6 by c. £0.7bn
- Increase in IFRS net asset value6 of c.£0.2bn
Customers, partners, financial advisors and agents of Aviva Italy will continue to receive the same high quality service from the businesses and there is no impact to customer policies as a result of this announcement. Employees of Aviva Italy will transfer with the businesses.
Aviva expects to use the increased capital and cash to support its previously communicated capital framework of debt reduction, investment for long-term growth and return of excess capital to shareholders.
The transactions are subject to customary closing conditions, including regulatory and anti-trust approvals, and are expected to complete in the second half of 2021.
1 Primarily comprises 51% shareholding in Aviva S.p.A. and 100% shareholding in Aviva Life S.p.A.
2 Comprises Aviva Italia S.p.A.
3 Multiple presented on a 100% basis.
4 On 23 November 2020, Aviva announced the sale of Aviva’s entire 80% shareholding in Aviva Vita S.p.A. to its partner UBI Banca.
5 Estimated financial impacts of the transactions presented in isolation from impacts of other announced transactions.
6 Using 31 December 2020 GBP/EUR FX spot rate of £1/€1.12.
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