Aviva and Friends Life merger will create the largest life and pensions firm in the UK
In December last year, Aviva agreed to buy Friends Life in a deal worth £5.6bn. Today (26 March) Aviva Shareholders and Friends Life Scheme Shareholders voted in support of the deal. 99.79% of the Aviva Shareholders votes cast in favour of the Proposed Acquisition at the Aviva General Meeting authorising the directors of Aviva to allot new ordinary shares, up to an aggregate nominal amount of £276,250,000.
94.39% of Friends Life’s Scheme Shareholders votes were cast in favour of the Scheme at Friends Life’s Court Meeting. The merger will mean the combined firm will have 16m customers with Friends Life’s 5m customers benefiting from a broader range of products.
Aviva would acquire the entire ordinary share capital of Friends Life on the basis of an exchange ratio of 0.74 Aviva ordinary shares for each Friends Life ordinary share. Shareholders of Friends Life will own approximately 26 per cent of the enlarged group under the terms agreed.
Mark Wilson, Group Chief Executive Officer, said: “We welcome shareholders’ endorsement of the financial and strategic logic of this acquisition. This is the right deal at the right time for Aviva.”
“The enlarged UK Life business, to be led by Andy Briggs, will be an industry leader, well positioned to serve customers in the vibrant UK life and pensions sector.”
Andy Briggs, Group Chief Executive, Friends Life, said: “We are delighted that our shareholders have today voted in favour of the recommended all-share acquisition by Aviva. The Friends Life Board believes that the combination of the two businesses offers attractive growth opportunities for the shareholders of the enlarged Group, as the increased scale will help drive better profitability, and improved service as our customers will benefit from access to a broader range of products.”
The Proposed Acquisition received European Commission clearance on 13 March 2015 and was approved by the Prudential Regulation Authority and the Financial Conduct Authority on 17 March 2015. Completion of the Proposed Acquisition remains subject to the satisfaction or waiver of the remaining Conditions set out in the Scheme Document, including the Guernsey Court sanctioning the Scheme at the Guernsey Court Hearing which is expected to take place on 10 April 2015. Subject to the Scheme receiving the sanction of the Guernsey Court on that date, the Scheme is expected to become effective on 10 April 2015.
It is also expected that the listing of and dealings in Friends Life Shares will be suspended with effect from 7.30 a.m. on 10 April 2015. If the Guernsey Court sanctions the Scheme on 10 April 2015, the listing of the Friends Life Shares will be cancelled with effect from 8.00 a.m. on 13 April 2015, the New Aviva Shares will be issued to the relevant Scheme Shareholders by 8.00 a.m. on 13 April 2015 and commencement of dealings in the New Aviva Shares on the London Stock Exchange will take place at 8.00 a.m. on 13 April 2015.