Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Activist Cevian takes Aviva stake, seeks 5 billion stg capital return

Stock MarketsJun 08, 2021 04:41AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. FILE PHOTO: The Aviva logo sits outside the company head office in the city of London, Britain March 7, 2019. REUTERS/Simon Dawson

By Carolyn Cohn

LONDON (Reuters) -Activist investor Cevian Capital said Aviva (LON:AV) should return 5 billion pounds ($7.08 billion) of excess capital in 2022 after revealing it has built up a near 5% stake in the British insurer, putting new CEO Amanda Blanc under pressure to accelerate changes.

Aviva, which has sold eight businesses since the appointment of Blanc as CEO in July 2020, said last month it had raised 7.5 billion pounds from disposals and planned to return money to shareholders, without putting a figure on it.

"Aviva has been poorly managed for many years, and its high-quality core businesses have been held back by high costs and a series of bad strategic decisions," Christer Gardell, managing partner and co-founder of Cevian said in a statement.

Analysts have said the insurer would have between 3.7 billion and 6.6 billion pounds of excess capital following the completion of the asset sales.

Aviva should have a value of more than 8 pounds per share within three years, and more than double its dividend to 45 pence, Cevian said.

Aviva's shares are currently trading above 4 pounds a share and rose 3.5% on the Cevian statement.

Cevian also said it saw scope for further cost-cutting, totalling at least 500 million pounds by 2023. Aviva outlined a strategy last year including 300 million pounds in cost cuts by 2022.

Aviva is shifting focus to the key markets of Britain, Canada and Ireland since the asset sales.

Industry sources have speculated the insurer could make further changes such as selling books of life insurance business closed to new customers. The Canadian unit might also attract buyers, they said.

"Aviva has made significant strategic progress over the past 11 months and we remain sharply focused on further improving our performance," an Aviva spokesperson said in an emailed statement.

"We regularly engage with investors and welcome any thoughts which move us towards our goal of delivering long term shareholder value."

Cevian bought a stake in rival insurer RSA in 2013 which it built up to 15%, culminating in the completion last week of RSA's sale to Denmark's Tryg and Canada's Intact Financial.

Cevian started building up the stake in Aviva several months ago, with relations cordial between the investor and Aviva's management, according to two sources familiar with the matter.

Chairman George Culmer and CEO Blanc are "committed to...delivering substantial shareholder value", Cevian said in the statement.

($1 = 0.7063 pounds)

Activist Cevian takes Aviva stake, seeks 5 billion stg capital return

Related Articles

3 Gold Miners to Buy on the Dip for 2022
3 Gold Miners to Buy on the Dip for 2022 By StockNews - Dec 02, 2021

It’s been a rough year thus far for investors in the Gold Miners Index (GDX (NYSE:GDX)), with the ETF being one of the worst performers year-to-date. This is evidenced by its...

How Will the Omicron Variant Impact the Stock Market?
How Will the Omicron Variant Impact the Stock Market? By StockNews - Dec 02, 2021

The S&P 500 (SPY) is once again trashing value stocks. And yet for all the recent red arrows tossed to the entire market, we still see green shoots in our POWR Value portfolio....

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email