Aviva has finally sold its unwanted US business for $1.8bn (£1.1bn) as part of its strategic review following the ousting of chief executive Andrew Moss.
The insurer is selling its US life and annuities operations, which it bought in 2006 for £2bn, to American insurer Athene Holdings. It will receive cash proceeds of $1.55bn after repaying external debt. It will keep the north American asset management business of Aviva Investors.
The insurer's restructuring plan, outlined by chairman John McFarlane in July after Moss left in May, involves selling 16 underperforming businesses. It did not confirm the US business was on the block, but analysts expected its uninspiring results left it vulnerable to a sale. McFarlane said:
The sale of Aviva USA is an important step forward in the delivery of our strategic plan. It considerably strengthens Aviva's financial position, increases group liquidity and improves our economic capital surplus whilst also reducing its volatility.
The disposal of the US business, combined with the recent settlement with Bankia [after a dispute over a breached distribution agreement], represents a successful end to the year and sets us up well for 2013.
Aviva shares have dipped 0.7p to 383.3p on the news.
