Aviva Plc · LSE:AV.
Aviva — Merger or Acquisition (July 2003)
14 slides from Aviva's merger presentation, July 2003
Slide 1: Update on Joint Venture: Delta Lloyd Group - ABN AMRO Insurance
Delta Lloyd Group Update on Joint Venture Delta Lloyd Group - ABN AMRO Insurance Niek Hoek Chairman Executive Board Delta Lloyd July 2003 1
Slide 2: Strategic Rationale Joint Venture
Strategic Rationale Joint Venture § Expand client base § Create leading market positions in new business (Private & Group Life and Pensions, GI, Health) § Expand distribution capabilities (true multi-channel) § Asset Management opportunities § Synergies - Multi Channel, Multi Label, Single back offi
Slide 3: Perfect Fit Strategy Delta Lloyd
Perfect Fit Strategy Delta Lloyd Client Client Client Multi Label Intermediary Multi Channel Bank Direct SSC’s Single Back Office 3
Slide 4: Distribution power of ABN AMRO (the Netherlands)
Distribution power of ABN AMRO (the Netherlands) § Strong Brand § Access to 5m Clients 4 4.6m Consumer Clients 4 310k SME Clients 4 3k Corporate Clients 4 15k Private Clients (assets > € 1m) § Access to 570 bank shops + 80 advice offices § Direct channels (call centres, internet, mail) 4
Slide 5: Profile ABN AMRO Insurance
Profile ABN AMRO Insurance Full year 6 months 2002* 2003 €m €m GWP Life 720 364 General Insurance 128 87 Intermediary (Underwriting agents) 96 63 New business life Single 359 185 Regular 36 12 Embedded value Life 99 107 #76 General Insurance (NAV) 79 *Subject to completion accounts # After a pre-com
Slide 6: Total market share
Total market share (incl. U/W), Dutch market 2001, based on GWP ING 16.6% Fortis 12.0% DL Group (incl. AA) 9.8% Aegon 9.7% Achmea 9.3% Interpolis 8.0% Delta Lloyd NV 7.7% ABN AMRO 2.1% Source: Press Releases & AM Jaarboek, November 2002 6
Slide 7: Deal structure
Deal structure § 51% Life and 51% General Insurance (incl. Intermediary Business, Underwriting Agencies, Employee Benefit Consultants & Commercial Brokerage) § Brand ABN-AMRO § Management Control Delta Lloyd § Asset Management Delta Lloyd § 30 years exclusive distribution agreement § Extensive Servi
Slide 8: Organisational structure JV
Organisational structure JV ABN AMRO Delta Lloyd 49 % 51 % Bancassurance JV Intermediary Direct 100 % Life Non-Life Bank (AAL) (AAS) ACCESS TO BANK CLIENT DATABASE ABN AMRO Delta Lloyd Incentive based Distribution Fees Servicing Fees 8
Slide 9: Financials of deal
Financials of deal Purchase consideration €267m (includes €25m in respect of performance linked consideration) Annualised profits after tax and minorities Rights to new business and renewals 6 months 2003 • Life new business added value † €10m €15m • GI COR 95% Operating profit before tax and minori
Slide 10: Financials of deal (cntd)
Financials of deal (cntd) § Target growth of over 100% life (APE) and over 60% general insurance (GWP) by end 2006 § Integration costs €20m (pre-tax) by end 2005 § IRR of over 12% (after tax) 10
Slide 11: ABN AMRO bancassurance has a strong growth record
ABN AMRO bancassurance has a strong growth record ABN AMRO LIFE (GWP) 788 €m 800 705 720 CAGR 21% pa 700 600 568 479 500 400 349 300 233 200 100 0 1996 1997 1998 1999 2000 2001 2002 § ABN AMRO bancassurance business launched in 1995 § Top 10 position in Dutch market within 10 years 11
Slide 12: Growth potential of JV understates EV
Growth potential of JV understates EV § Low penetration (8-16%) compared to other Dutch banks § Commission levels set between direct & IFA § Focus on opportunities in: - Group Life (tax reform and supplementary pension schemes) - GI-Packages (packaged products show double digit growth) § Conversion
Slide 13: Conclusion
Conclusion § Delta Lloyd - ABN AMRO JV creates leading market positions - Substantial upside growth in life & general insurance - Expense advantage - Attractive life margins (H1 2003: 34%) - Excellent general insurance performance - 30 year exclusive agreement 13
Slide 14: Questions and Answers
delta lloyd Questions and Answers