11th Oct 2005 09:24
Aviva PLC11 October 2005 News release 11 October 2005 AVIVA UPDATE ON RAC INTEGRATION Lex Vehicle Leasing Aviva plc ("Aviva") announces that HBOS plc ("HBOS"), its 50:50 joint venturepartner in Lex Vehicle Leasing Limited ("LVL"), has exercised an option underthe JV agreement which will lead to Aviva's disposal of its stake in LVL. Aviva acquired the 50% stake in LVL as part of its acquisition of RAC earlierthis year, and was aware of HBOS's rights at the time the acquisition was made.This change of control triggered HBOS's option. Aviva and HBOS will now enter into discussions to agree a fair market value forLVL that may or may not lead to the sale of Aviva's interest in the JV to HBOS. Aviva's sale of its stake in the LVL joint venture will have no impact on thecost savings Aviva stated it would achieve as a result of integrating the RACbusiness into Norwich Union. Cost savings target to be exceeded Aviva confirms that it will exceed the cost savings target of £80 million perannum forecast at the time of the acquisition and now expects to achieve savingsof £100 million per annum in 2006. Aviva will present full details and further news of developments in its generalinsurance business in a seminar for investors and analysts on 18 October at ParkRoyal, London. Speakers will include Patrick Snowball, executive director ofAviva with responsibility for the group's general insurance portfolio, AndrewMoss, group finance director of Aviva, Mark Hodges, managing director of NorwichUnion General Insurance and Simon Machell, managing director of RAC. - ends - Enquiries: MediaRob Bailhache, Financial Dynamics +44 (0)20 7269 7200 AnalystsCharles Barrows, investor relations director +44 (0)20 7662 8115Nicole Marques, investor relations manager +44 (0)20 7662 8302 Notes to editors: • LVL is a 50:50 joint venture between RAC and HBOS. LVL providesvehicle leasing, supply, management, maintenance and incident support forcompanies who outsource the day-to-day operations of their fleets. In 2004 LVLcontributed £23 million of RAC's pre-tax earnings* of £102 million (*EBITAbefore group overheads and exceptional items). • Details of the Aviva general insurance seminar for investors andanalysts are as follow: Date: Tuesday, 18 October 2005Start: 0800 hrs for 0900 hrs (UK time)End: 1200 hrs (UK time) followed by lunchVenue: Solus House, Park Royal, LondonContact: [email protected] or call +44 (0)20 7662 1189 • Aviva is the world's sixth-largest insurance group based on grossworld-wide premiums and market capitalisation (at 31 December 2004); it is oneof the leading providers of life and pensions in Europe and has substantialbusinesses in other markets around the world. • Aviva's main activities are long-term savings, fund management andgeneral insurance, with world-wide total income of £40 billion and assets undermanagement of £280 billion at 31 December 2004. • The Aviva media centre at www.aviva.com/media includes images, companyand product information and a news release archive. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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