Aviva has dipped 3p to 449.6p as it confirmed details of the proposed flotation of its Dutch business Delta Lloyd.
The insurer plans to list a minority stake in the business in Amsterdam in Novembe, with analyts suggesting it would sell up to 30% to raise around £1.3bn. At least part of the proceeds, brokers believe, could go towards acquisitions. Panmure Gordon said this morning:
The key question for us is what will the sale proceeds be used for? It is possible that some or all of the anticipated cash could be used to restructure the balance sheet but we think that this is unlikely and that some if not all will be used for acquisitions.
Whilst Aviva's prudent strategy would suggest small bolt on acquisitions overseas (US, Continental Europe or Asia), we think that Aviva could use the proceeds and/or its paper to provide Resolution with competition for undervalued life/asset management operations.
Overall the market has edged higher, with the FTSE 100 even breaching the 5000 barrier at one point, before slipping back to 4997.23, up 8.53 points. Banks and miners are among the main gainers, with Royal Bank of Scotland recovering from Friday's falls, up 1.93p at 48.57p.
Miners benefited from positive noises on the sector from analysts at, as it happens, Royal Bank of Scotland. Kazakhmys has climbed 36.5p to £10.23 despite reports it may cut copper production this year. Some compensation is expected to come from growth in precious metals.
Among the other miners, Antofagasta has added 25.5p to 745.5p while Rio Tinto has risen 77p to 2582.5p.
