28th Mar 2014 08:04
LONDON (Alliance News) - Aviva PLC Friday said it is to sell US equity manager River Road Asset Management LLC to asset manager Affiliated Managers Group Inc, as it continues to implement its strategy of simplifying its business model.
The FTSE 100 life insurer and asset manager said its Aviva Investors asset management unit remains committed to the US market and has a strong business in Chicago.
Aviva said the Aviva Investors business is seeing strong growth in cross-border sales in product classes including global high yield and securitised products, global convertibles and real estate multi-manager and hedge fund of funds.
Chief Strategy and Development Officer Jason Windsor said a simpler, more focused business will help Aviva Investors become a stronger third-party manager and increase its contribution to the group.
"Aviva Investors is focused on becoming a fully-integrated asset manager offering products that deliver client outcomes with low volatility. A boutique US equity manager does not fit with this strategy. We look forward to a continued relationship with River Road," Windsor said in a statement.
Aviva, which didn't disclose financial details, said the sale represents a modest premium to group net asset value and will increase both the IGD solvency surplus and economic capital surplus by GBP100.0 million.
River Road, based in Louisville, Kentucky was acquired in 2009. At the end of 2013 it had USD11.00 billion in assets under management. It will continue to manage Aviva Investors' US Equity Income Funds.
The sale of River Road is subject to obtaining customary consents and approvals and completion is expected in the third-quarter of 2014.
In 2013 Aviva completed the sale of its US life insurance and annuities business to Athene Holding Ltd for USD2.6 billion.
In early trade Friday, Aviva shares are down 2.3% at 472.30 pence.
By Samuel Agini; [email protected]; @samuelagini
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