Aviva eyes £1bn from Delta float

Published on Monday 5 October 2009 21:31

AVIVA has confirmed plans for what is expected to be the largest European flotation this year, as it reduces its stake in Delta Lloyd next month.

Britain's second-largest insurer by market value is aiming to raise more than 1 billion by selling at least 30 per cent of the Dutch business.

Yesterday, it confirmed it would list Delta Lloyd, which offers financial services mainly in Belgium and the Netherlands, on Euronext's Amsterdam exchange, probably in November.

Proceeds from the initial public offering (IPO) will allow Aviva to reduce its debt, and opens the possibility of it seeking further acquisitions.

The number of flotations slumped during the financial crisis as shares plunged, destroying appetite for new share issues. With equity markets rallying in recent months, dozens of listed companies have tapped investors for cash, a trend expected to lead to a recovery in floats.

As well as freeing capital, Aviva said floating Delta Lloyd would help that business take part in an expected consolidation of the Benelux financial services sector.

Britain's insurance sector is tipped for consolidation, although few deals have materialised this year aside from Resolution's takeover of Friends Provident.

Meanwhile RSA, previously Royal & Sun Alliance, has reportedly abandoned plans for a $1bn (628 million) rights issue to pursue acquisitions, after potential targets ruled themselves out.