14th Apr 2014 07:53
LONDON (Alliance News) - Aviva PLC Monday said it has agreed to sell its 47% stake in South Korean business Woori Aviva Life Insurance to NongHyup Financial Group, as the insurer continues to focus on markets where it has scale or a sustainable competitive advantage to maximise return on capital.
In a statement, Aviva said the deal will have a neutral impact on its IFRS net assets and will increase economic capital surplus by GBP200.0 million, recognising the reduced exposure to interest rate and credit risk.
Woori Aviva Life Insurance is majority-owned by Woori Financial Holdings Company Ltd, which has also agreed to sell its stake to NongHyup Financial Group as part of this transaction.
The sale of WALI is part of a broader privatisation of Woori by the Government of South Korea, and is subject to regulatory approval.
"Aviva has a strong presence in China and South East Asia, which are key future cash generators for the group. This deal provides further focus to our Asian businesses, which increased value of new business by 65% in 2013," Chief Executive of Aviva Asia, Khor Hock Seng, said in a statement.
Woori Aviva Life Insurance was established in 2008 following an agreement between Aviva and Woori Finance Holdings Company Ltd.
It distributes life insurance products through Woori Financial Holdings distribution network of over 1,300 branches across 16 provinces and a sales network of over 1,600 tied agents and 138 agencies along with 51 WALI branches
In January 2014 Aviva entered a joint venture with PT Astra International Tbk to create a life insurer, Astra Aviva Life, in Indonesia, which it Monday said underlines its commitment to selected markets in Asia.
That move was followed by the sale of 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.
Aviva shares were Monday quoted at 497.00 pence, down 0.4%.
By Samuel Agini; [email protected]; @samuelagini
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