Aviva and Friends Life confirm £5.6bn merger
Aviva and Friends Life have reached agreement on a £5.6bn merger a week after disclosing that they were in advanced talks about creating the UK's "leading insurance and savings business in the UK."
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On Friday 21st, Aviva issued a statement following “recent press speculation”, confirming it has reached “agreement on the key financial terms” of a buyout that could be worth £5.6bn.
The deal, confirmed today, sees Friends Life’s shares valued at 394 pence, including a second interim dividend of 24.1p and the company being rebranded Aviva.
The addition of Friends Life will extend Aviva's customer base from 11 million to 16 million and is expected to generate about £225m of annual cost savings by the end of 2017.
Aviva chief executive Mark Wilson said:
"It is one of those rare transactions where the two organisations fit with surgical precision, building on each other's strengths and addressing the challenges."
He added that as a result of the deal, the two insurers’ customers would now have access to a wider range of retirement income products, with the companies looking at developing more deals ready for the pension reforms next year.
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