Aviva exits Italian market with $1.1bn Allianz, CNP deal

Global insurer Aviva has exited from the Italian market through a pair of deals with Allianz and CNP Assurances totaling €873 million ($1.1 million) in a bid to focus on its core businesses in the UK, Ireland and Canada.

Allianz has agreed to acquire Aviva’s general insurance business Aviva Italia, the Italian P/C entity including motor and non-motor business segments, for €330 million in cash.

The deal will increase Allianz S.p.A.’s P/C market share in Italy by approximately 1 percentage point, consolidating its position as number three player in the Italian P/C market.

CNP Assurances will buy Aviva's remaining Italian life insurance business for €543 million. Aviva already sold its Italian life insurance joint venture Aviva Vita to UBI Banca for €400 million in November 2020.

The UK-based insurer said the move is a part of its strategic transformation to focus on its strongest businesses in the core markets, and unlock capital and cash for debt reduction, investment in long-term growth and return to shareholders.

Together with proceeds from the UBI deal, Aviva will realise over €1.3 billion of cash from the sale of its insurance businesses in Italy.

The transactions are subject to customary closing conditions, including regulatory and antitrust approvals, and are expected to complete in the second half of 2021.

Amanda Blanc, chief executive officer of Aviva, said: “Since I announced our new strategy in August last year, we have announced seven divestments that will generate over £5bn of cash proceeds. This rapid progress allows us to focus on transforming and growing our already strong businesses in the UK, Ireland and Canada.

"The sale of our Italian operations to high quality buyers is a positive outcome for our customers, employees, distributors and shareholders. We promised that we would deliver quickly and we are. Our work to improve Aviva for the benefit of our shareholders continues.”

Giacomo Campora, chief executive of Allianz S.p.A., commented: "The acquisition of Aviva Italia S.p.A. perfectly fits with our strategy of growth in the insurance market, based on a solid technological platform and on continuous investments to offer our customers and agents products and services of an outstanding quality."

According to S&P Global Ratings, the sale will not weaken Aviva's competitive position in the market.

"Although Aviva's geographic footprint is shrinking, we view its competitive position in its core markets of the U.K., Canada, and Ireland as robust; it enjoys leading market positions and a powerful brand," the agency said.

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