UK insurance giant Aviva has boosted its coffers today by announcing the sale of its entire 50% shareholding in life insurance joint venture Antarius.
The company will pick up £425 million for the sale of the Societe Generale subsidiary, ending its joint venture with Credit du Nord, a separate Societe Generale subsidiary. The agreement follows Credit du Nord’s decision in 2015 to exercise its option to purchase Aviva’s shareholding.
According to Aviva group chief executive officer Mark Wilson, the deal is good value for the firm particularly as it represents approximately 1.7 times Aviva’s share of the IFRS net asset value of Antarius and 16.4 times Aviva’s share of the earnings after tax of Antarius. The transaction price is approximately £180 million above Aviva’s IFRS book value and further increases Solvency II capital by approximately £200 million.
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“This is a good deal at an attractive valuation and the sale realises a strong return for our shareholders,” he said. “We have also agreed a new investment management mandate with Antarius and we look forward to continuing our long and successful partnership with Société Générale.”
Indeed Aviva’s relations will continue as Aviva Investors France has entered an agreement with Sogecap to manage in excess of €10 billion assets held by Antarius.
The deal between Aviva and Antarius was originally made back in 2004 – it was a 12-year distribution agreement to sell life insurance and protection productions via Credit du Nord’s network.
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