Aviva has sold its joint share in the bancassurance venture Avipop to Banco BPM for €265mn.
The British insurance giant has elected to sell its Italian subsidiary due to Banco BPM stating its intentions to not renew their distribution deal.
According to a statement, Aviva has triggered a clause in the original agreement that allowed it to cash in its share if the distribution arrangement was discontinued.
Banco BPM, the Italian bank founded at the beginning of the year following a merger between Banco Popolare and Banca Popolare di Milano, will take full control of Avipop following the completion of the cash transaction.
Aviva said the price represents 27.1 times Aviva’s share of the joint venture’s 2016 earnings after tax and will increase its Solvency II capital by around £200mn.
Its other interests in Italy are unlikely to be affected, with the transaction set to be formalised in 2018.