Aviva sells Friends Provident for £340m to International Financial Group subsidiary


Big deal of the day

Aviva has announced the sale of Friends Provident International Limited (“FPIL”) to RL360 Holding Company Limited, a subsidiary of International Financial Group Limited, for a total consideration of £340m.

Following a strategic review of FPIL, Aviva has concluded that the business is not central to thegroup’s strategy to focus on a small number of markets where it has scale and profitability or a distinct competitive advantage. The sale of FPIL will allow Aviva to further reallocate capital to businesses that can achieve leading market positions and deliver superior returns.

The consideration represents a multiple of 3.2x FPIL’s 2016 net asset value. The transaction will result in an increase of approximately £100m in Aviva’s Solvency II capital surplus. The transaction will also create an IFRS loss on disposal of approximately £130m, which is primarily due to the intangible assets held on Aviva’s balance sheet arising from Aviva’s acquisition of FPIL in 2015.

Chris Wei, Executive Chairman, Aviva Asia & FPIL, said: “The sale of Friends Provident International Limited is a good outcome for Aviva. It allows us to

focus on the significant opportunities we have to grow Aviva’s business across Asia through digital and disrupting the traditional insurance industry.”