Aviva withdraws €475m of capital from Spain
10 May 2017
Aviva plc (“Aviva”) announces the sale of its 50% shareholdings in life insurance and pension joint ventures Unicorp Vida1 and Caja España Vida2, as well as its retail life insurance business Aviva Vida y Pensiones3, to Santalucía4. Total consideration of the transaction is €475m (£403m).
The transaction is in line with Aviva’s strategy of allocating capital to markets where it can deliver higher returns and is part of a strategic review of its Spanish operations.
The consideration represents approximately 1.5 times Aviva’s share of the 2016 IFRS net asset value and 12 times Aviva’s share of 2016 earnings after tax of these businesses. The transaction will result in a gain of approximately £120 million in Aviva’s IFRS net asset value and an increase of approximately £130 million in Aviva’s Solvency II capital surplus.
The transaction is subject to regulatory and anti-trust approvals and is expected to complete in the fourth quarter of 2017.
In Spain, Aviva will continue to hold shareholdings in life insurance joint ventures with Caja Granada and Cajamurcia, both part of Banco Mare Nostrum, and Pelayo Group5.
Following the restructuring of the Spanish banking system, which started in 2010, and the subsequent consolidation among Aviva’s banking partners, Aviva has taken steps to protect the value of its distribution agreements in Spain. As a result, Aviva sold its shareholdings in its joint ventures with Bankia in 2012 and Novacaixagalicia Grupo in 2014 for a combined £720m6.
Mark Wilson, Group Chief Executive Officer, Aviva, said:
“This is a strong outcome for Aviva. The consideration of €475m is an attractive valuation and the sale further simplifies the Group. It highlights our absolute focus on allocating capital effectively across the group and further strengthens our capital and liquidity position.”
1 Unicorp Vida Compañía de Seguros y Reaseguros, S.A. is a 50-50 joint venture with Unicaja Banco
2 Caja España Vida Sociedad de Seguros y Reaseguros, S.A. is a 50-50 joint venture with Caja España, now part of Banco Ceiss
3 Including Aviva Vida y Pensiones’ fund management subsidiary Aviva Gestión Sociedad Gestora de Instituciones de Inversión Colectiva, S.A.
4 Santa Lucía, S.A, Compañía de Seguros y Reaseguros
5 Legal entity names: Caja Granada Vida de Seguros y Reaseguros, S.A.; Caja Murcia Vida y Pensiones de Seguros y Reaseguros, S.A.; Banco Mare Nostrum, S.A.; Pelayo Vida Seguros y Reaseguros, S.A.
6 Proceeds based on EUR-GBP exchange rates at time of the transactions
Yasmin Saleh +44 (0)20 7662 8710
Chris Esson +44 (0)20 7662 8115
Diane Michelberger +44 (0) 20 766 20911
Notes to editors:
- Proceeds converted to GBP at an exchange rate of €1.18/£1
- Aviva’s LEI code is YF0Y5B0IB8SM0ZFG9G81.
- Aviva provides life insurance, general insurance, health insurance and asset management to 33 million customers, across 16 markets worldwide.
- In the UK we are the leading insurer serving one in every four households and have strong businesses in selected markets in Europe, Asia and Canada. Our shares are listed on the London Stock Exchange and we are a member of the FTSE100 index. Aviva’s asset management business, Aviva Investors, provides asset management services to both Aviva and external clients, and currently manages over £340 billion in assets. Total group assets under management at Aviva group are £450 billion.
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