Aviva PLC (LON:AV.) has sold its stake in its Italian joint venture to Banco BPM, the newly combined group of Banco Popolare and Banca Popolare di Milano.
The joint venture, Avipop Assicurazioni SpA, was formed in 2007 with Banco Popolare and distributes life and general insurance products.
Aviva has sold its entire 50% holding in Avipop, together with its wholly-owned subsidiary Avipop Vita SpA, to Banco BPM. Banco Popolare and Banca Popolare di Milano was merged into Banco BPM earlier this year.
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Sale puts company in good position to grow business
In a statement, Maurice Tulloch, chief executive of Aviva International Insurance, said: “This transaction will realise value for Aviva shareholders and will allow us to invest further in our future growth.
“Aviva has momentum in Italy and I am confident about our prospects.
“We are now in a good position to grow our business further, with our partners and through digital.”
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Aviva shares up
In June Aviva received a notification of Banco BPM’s intention to not renew its bancassurance agreement with the British-based insurer.
Under its joint venture agreement, Aviva had the option to sell its entire shareholding to Banco in the event of a termination of the distribution deal.
In 2016, the two Avipop businesses contributed £0.2bn to Aviva’s net assets and generated about £14mln operating profit before tax.
Shares in Aviva rose 0.42% to 525.20p in early trading.