Aviva, Sabanci to merge Turkish insurance ops
Britain's Aviva Plc said on Friday it would merge its Turkish life and pension business with part of Sabanci Holding
LONDON: Britain's Aviva Plc said on Friday it would merge its Turkish life and pension business with part of Sabanci Holding to create the largest pensions provider in the country with a 25 percent market share.
After five years of the deal, total annual pension contributions and life premiums for the venture are expected to top 500 million pounds ($996.6 million), with total assets under management of 2 billion pounds, Britain's biggest insurer said.
The joint venture will enter into an exclusive long-term bancassurance agreement with Akbank , Turkey's second largest privately-owned bank, Aviva said.
The merger will combine the direct sales force of Aviva HE, the UK insurer's Turkish life and pensions business, with Ak E, the life and pensions business of Sabanci's insurance arm Aksigorta .
The joint venture will be the largest pensions provider in the market with pensions assets under management of 290 million pounds, and it will be the third largest life insurer, with an 11 percent market share, Aviva said.
Aviva and Sabanci said they expect strong growth in the Turkish insurance sector, due to a low current insurance penetration rates and economic growth prospects.
Aviva will make a cash payment of $100 million to Aksigorta on completion of the deal, and the British firm and Sabanci will have equal shareholdings.
Aviva signed preliminary agreements with Aksigorta and Akbank in March, but no details were announced at that time.
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