National Australia Bank(NAB) has agreed to purchase Aviva Australia Holdings’ wealth management business including its life insurance operations and investment platform, Navigator, for $825 million. The acquisition is expected to be earnings per share and return on equity accretive in the first full year following acquisition (excluding estimated integration costs). Prior to completion Aviva Australia Holdings will pay a $40 million dividend.
“This acquisition will enhance our offering in key wealth management segments including insurance and investment platforms, adding scale, efficiency and new capabilities to our operations,” National Australia Bank Group Chief Executive Officer Cameron Clyne said. “The acquisition meets the objectives outlined in the NAB Strategy earlier this year. Our MLC and NAB wealth management business is a key area of growth for us and we are well positioned to respond to changes currently taking place in the wealth management market as a result of the financial crisis and regulatory reviews,” he said. “Aviva has strong relationships with and understanding of the external financial adviser (EFA) market and we are committed to continue to support EFA advisers with quality insurance and investment products.”
The acquisition is subject to regulatory approvals and confirmation from the ACCC that it has no objection, and is expected to be completed during the fourth quarter of 2009. The acquisition excludes Aviva’s asset management business and its interest in the Professional Investment Holdings business.
