Aviva to sell off insurance business in Asia

Financial services company Aviva is to sell its general insurance businesses in Asia to Mitsui Sumitomo Insurance for £249m (€366.2m) in cash.

"Aviva will retain and develop its long-term savings operations in the region, which operate under the Aviva brand and have a separate management team, platform and distribution networks to the businesses," the company said today.

Under the terms of the agreement, MSI will acquire all of Aviva’s general insurance businesses in Asia. These comprise the general insurance business of Aviva Limited and the general insurance assets of Aviva Asia Pte Ltd in Singapore; Aviva Insurance Berhad in Malaysia (including its branch in Brunei); Aviva Insurance (Thai) Co Ltd in Thailand; PT Aviva Insurance in Indonesia; Dah Sing General Insurance Co Ltd in Hong Kong; and Aviva’s branch operations in Hong Kong, the Philippines, Marianas, Macau and Taiwan.

The transaction will be achieved through share purchase of Aviva’s interests in joint venture operations, business purchase and asset purchase in Singapore, and transfer of Aviva’s general insurance branch operations in Hong Kong, Philippines, Marianas, Macau and Taiwan.

Group boss Richard Harvey said: “This is an excellent deal for Aviva’s shareholders. The price is equivalent to approximately 2% of our market capitalisation. In contrast, the businesses account for 1.1% of group operating profit.

“It is also a very good deal for staff. MSI is committed to maintaining the existing operating structure and will run the businesses as a separate division, complementing its current focus on Japanese customers in the region."