Delta Lloyd, the Dutch subsidiary of Aviva plc (“Aviva”) has today announced that Agis Health Insurance, Menzis Health and Income and the health insurers of Delta Lloyd Group - Delta Lloyd and OHRA Health, have reached an agreement on their proposed merger. The agreement is subject to consultation and agreement with the relevant regulators, shareholders, member councils and consultative bodies.
Delta Lloyd, the Dutch subsidiary of Aviva plc (“Aviva”) has today announced that Agis Health Insurance, Menzis Health and Income and the health insurers of Delta Lloyd Group - Delta Lloyd and OHRA Health, have reached an agreement on their proposed merger. The agreement is subject to consultation and agreement with the relevant regulators, shareholders, member councils and consultative bodies.
The new health combination will operate under the name ‘DAM Health Insurance Group’. Customers of DAM Health Insurance Group will remain insured through the existing brands of Menzis (including Confior, Anderzorg, Ardyn en Prové), Agis (including Prolife), OHRA and Delta Lloyd.
Delta Lloyd has acquired a 31% stake in DAM Health Insurance Group, in exchange for its healthcare businesses, which had net assets of Ł180 million as at 30 June 2006. The stakes of each party have been determined by reference to the intrinsic value of each business, on a consistent basis of calculation between the three merger partners and at no premium. In addition, Delta Lloyd will gain the exclusive rights to cross sell life and general insurance to the customers of DAM Health Insurance Group, and provide asset management services.
Comprising all activities in the field of health insurance, additional health insurance and exceptional health costs insurance (AWBZ), the combination will give rise to one of the leading health insurers in the Netherlands with 4 million customers and a 25% market share.
Market outlook
The main considerations underlying the decision to merge these health insurance operations are:
- to jointly create a socially committed, competitive, innovative, financially solid and healthy company that is strongly placed in terms of both market position and size;
- to improve the management of claims and realise cost savings, specifically on the purchasing side, and to achieve a more streamlined internal organisation;
- to establish a health insurer on a national scale by combining the parties' complementary geographical strengths;
- to reinforce the distribution network by using direct, intermediary and bancassurance networks.
The new health insurer believes there will be competitive advantages in providing access to high quality healthcare and good service at a competitive cost. The group will consequently invest in innovation and product development and aims to play a leading role in the debate on healthcare.
DAM Health Insurance Group and Delta Lloyd Group have made exclusive arrangements on cross-selling and distribution. Delta Lloyd Group will exclusively sell the health insurance services of the new combination via its distribution channels and will also be given the opportunity to offer general and life insurance services to the customers of DAM Health Insurance Group. Furthermore, Delta Lloyd Group will provide the asset management services for the new combination.
Future organisation
The three health insurers will present proposals for the implementation of the merger to their works councils and member councils or shareholders. The NMA (the Netherlands Competition Authority) already announced on 10 October that it had no objection to the proposed merger.
The new joint venture is expected to be in place on 2 January 2007 and control of the joint venture will transfer to the new executive board shortly afterwards.
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Jessie Burrows, head of investor relations +44 (0)20 7662 2111
Notes to editors:
- Aviva is one of the leading providers of life and pensions to Europe with substantial positions in other markets around the world, making it the world’s fifth largest insurance group based on both gross worldwide premiums at 31 December 2005.
- Aviva’s principal business activities are long-term savings, fund management and general insurance, with worldwide total sales of Ł36 billion and assets under management of Ł322 billion at 31 December 2005.