Aviva buys Friends First for €130m
Dutch financial group Achmea is poised to extract €220 million from its move to sell Friends First, the Irish life assurance, pensions and investment firm, to Aviva.
UK insurer Aviva confirmed yesterday that it has agreed to buy Friends First, the Irish life assurance, pensions and investment firm, for €130 million in cash.
However, Achmea said separately that its total proceeds should rise to €220million. This includes up to €90 million of dividends, or excess capital, being paid by Friends First to the Dutch group by the time the deal is expected to complete in the first quarter of next year.
On completion of the transaction, Aviva’s Irish business will have 15 per cent shares of the life insurance and general insurance markets in Ireland, Aviva said in a statement. A spokeswoman for Aviva Ireland said the company expects to have a limited voluntary redundancy scheme after the deal closes as there will be duplications of roles among the combined 1,530 staff.
“We don’t expect many jobs will be lost. There will also be lots of opportunities for redeployment as this is a growing business,” the spokeswoman said, adding that Aviva will begin identifying potential savings in the coming months.
Friends First employs 330 people and has more than 250,000 customers. Aviva Ireland, which posted 12 per cent operating profit growth in the first half of the year to €48 million, has 1,200 staff and almost one million customers.
“Friends First is a natural fit for Aviva Ireland,” said Maurice Tulloch, chief executive of Aviva International Insurance. “The acquisition will enhance Aviva Ireland’s product offering and accelerate our international growth agenda.” Aviva Ireland chief executive John Quinlan said the deal will make the company the “leading insurer for brokers in the Irish market”.