Aviva and Friends Life agree to $8.8 Billion Merger

Aviva and Friends Life agree to $8.8 Billion Merger

Aviva and Friends Life agree to $8.8 Billion Merger

Aviva, the British insurer, agrees to acquier Friends Life for $8.8 Billion in all stock deal.

 Under the terms of the deal, Aviva will pay 0.74 shares of Aviva for each Friends Life share. That represented a total value about £5.6 billion.

 “This acquisition is financially and strategically compelling,” Mark Wilson, Aviva’s chief executive, said in a news release. “It is one of those rare transactions where the two organizations fit with surgical precision, building on each other’s strengths and addressing the challenges.”

 Friends Life shareholders receive second interim dividend of 24.1 pence  a share for 2014 financial year, it means full year dividend of 31.15 pence a share.

 “By combining the market-leading strengths of the two businesses, we will create the U.K.’s leading insurance, savings and asset management business, delivering additional scale and efficiencies,” said Malcolm Williamson, Friends Life’s chairman,  in a news release. “This will provide enhanced outcomes for the increased customer base and for new customers into the future.”

 CEO of Friends Life, Andy Briggs, would become chief of Aviva’s life insurance business in Britain and would join board of combined company as an executive director. Malcolm Williamson joins Board of Aviva as senior independent director.

 The deal is regulatory and shareholder approval with expected to close in second quarter.

 Aviva is advised by JPMorgan Chase, Morgan Stanley and Robey Warshaw, while Friends Life is advised by Goldman Sachs, Royal Bank of Canada and Barclays.

Mr. Stakebay says:

 This merger creates largest life insurer in Great Britain. The deal would create insurance and asset management business worth about 20.7 billion pounds and more than 300 billion pounds in AUM and £ 225 million of annual cost savings by the end of 2017. Shareholders of Friends Life would own about 26 percent of the combined company with about 16 million customers.

 

 

AVIVA

FRIEND’S LIFE GROUP

Revenue

£ 22.035 billion (2013)

£ 10.989 billion (2013)

Operating income

£ 20.623 billion (2013)

£ 35 million (2013)

Profit

£ 2.151 billion (2013)

£ 235 million (2013)

Total assets

£ 278.876 billion (2013)

£ 130.091 billion (2013)

Total Equity

£ 11.017 billion (2013)

£ 5.549 billion (2013)

Employees

27 718 (2013)

3 872(2013)

 

CEO of AVIVA……………………………MARK WILSON……….2013-present…….£ 5 300 000 (2013)

CEO of FRIENDS LIFE GROUP…….ANDREW BRIGGS………2012-present…….£ 1 627 000 (2013)

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