3rd Nov 2006 10:32
Aviva PLC03 November 2006 News release 3 November 2006 AVIVA'S DUTCH SUBSIDIARY, DELTA LLOYD CONFIRMS MERGER OF HEALTH INSURANCEOPERATIONS Delta Lloyd, the Dutch subsidiary of Aviva plc ("Aviva") has today announcedthat Agis Health Insurance, Menzis Health and Income and the health insurers ofDelta Lloyd Group - Delta Lloyd and OHRA Health, have reached an agreement ontheir proposed merger. The agreement is subject to consultation and agreementwith the relevant regulators, shareholders, member councils and consultativebodies. The new health combination will operate under the name 'DAM Health InsuranceGroup'. Customers of DAM Health Insurance Group will remain insured through theexisting brands of Menzis (including Confior, Anderzorg, Ardyn en Prove), Agis(including Prolife), OHRA and Delta Lloyd. Delta Lloyd has acquired a 31% stake in DAM Health Insurance Group, in exchangefor its healthcare businesses, which had net assets of £180 million as at 30June 2006. The stakes of each party have been determined by reference to theintrinsic value of each business, on a consistent basis of calculation betweenthe three merger partners and at no premium. In addition, Delta Lloyd will gainthe exclusive rights to cross sell life and general insurance to the customersof DAM Health Insurance Group, and provide asset management services. Comprising all activities in the field of health insurance, additional healthinsurance and exceptional health costs insurance (AWBZ), the combination willgive rise to one of the leading health insurers in the Netherlands with 4million customers and a 25% market share. Market outlook The main considerations underlying the decision to merge these health insuranceoperations are: • To jointly create a socially committed, competitive, innovative,financially solid and healthy company that is strongly placed in terms of bothmarket position and size; • To improve the management of claims and realise cost savings,specifically on the purchasing side, and to achieve a more streamlined internalorganisation; • To establish a health insurer on a national scale by combining theparties' complementary geographical strengths; • To reinforce the distribution network by using direct, intermediaryand bancassurance networks. The new health insurer believes there will be competitive advantages inproviding access to high quality healthcare and good service at a competitivecost. The group will consequently invest in innovation and product developmentand aims to play a leading role in the debate on healthcare. DAM Health Insurance Group and Delta Lloyd Group have made exclusivearrangements on cross-selling and distribution. Delta Lloyd Group willexclusively sell the health insurance services of the new combination via itsdistribution channels and will also be given the opportunity to offer generaland life insurance services to the customers of DAM Health Insurance Group.Furthermore, Delta Lloyd Group will provide the asset management services forthe new combination. Future organisation The three health insurers will present proposals for the implementation of themerger to their works councils and member councils or shareholders. The NMA (theNetherlands Competition Authority) already announced on 10 October that it hadno objection to the proposed merger. The new joint venture is expected to be in place on 2 January 2007 and controlof the joint venture will transfer to the new executive board shortlyafterwards. - ends - Enquiries: Media Hayley Stimpson, director of external affairs +44 (0)20 7662 7544Vanessa Booth, group media relations manager +44 (0)20 7662 2482 Analysts Charles Barrows, investor relations director +44 (0)20 7662 8115Jessie Burrows, head of investor relations +44 (0)20 7662 2111 Notes to editors: • Aviva is one of the leading providers of life and pensions to Europewith substantial positions in other markets around the world, making it theworld's fifth largest insurance group based on both gross worldwide premiums at31 December 2005. • Aviva's principal business activities are long-term savings, fundmanagement and general insurance, with worldwide total sales of £36 billion andassets under management of £322 billion at 31 December 2005. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Aviva