PRESS: City Investors Oppose Aviva's Preference Share Cancellation (ALLISS)

21st Mar 2018 08:15

LONDON (Alliance News) - FTSE 100-listed insurer Aviva PLC has met with opposition from a group of investors concerning its proposal to cancel three issues of preference shares collectively worth GBP450.0 million, The Times reported on Wednesday.

The group - made up of M&G Prudential, Invesco, GAM, Blackrock, Legal & General PLC and EdenTree - met with Aviva Chairman Adrian Montague to ask the firm to back down from the proposed cancelling of preference shares, which pay an average yield of 8.5% annually.

The investor group owns an aggregate of 30% of preference shares in Aviva and 15% of ordinary shares. Preference share do not hold voting rights, but offers a fixed rate of interest, making them more like bongs than shares.

In addition, Chairwoman Nicky Morgan of the Treasury select committee has asked the UK Financial Conduct Authority if Aviva's proposal in is line with UK listing rules.

Aviva first announced in early March along with its results for 2017 that it could cancel its preference shares, which is expected to save the insurer GBP38.0 million a year in coupon payments.

https://www.thetimes.co.uk/edition/business/city-attacks-aviva-bid-to-cancel-preference-shares-ln0t3shr2

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