Vienna Insurance Group expands via Aegon acquisition
Specifically, the company will be absorbing Aegon’s life and non-life business in Hungary, Poland, Romania and Turkey, including pension funds worth €5bn (US$6bn), asset management and service companies.
The total purchase price has been declared as €830m ($994m), with the deal expected to conclude before the second half of 2021.
Securing the market
Founded in 1824, Vienna Insurance Group’s (VIG’s) already enjoys a commanding presence in its region and is recognised as one of the largest international insurance groups operating.
“This will make us – as in Austria – the market leader in all our immediate eastern neighboring countries (Czech Republic, Slovakia and Hungary). In Turkey, we succeed in entering the life insurance market and in Poland, Romania and Hungary we can significantly expand our potential in the pension fund business.
“By acquiring the asset management company of Aegon in Hungary, we are not only expanding our own asset management activities, we are also gaining valuable know-how and resources.”
In combination with that Standard & Poor (S&P) has reaffirmed VIG’s ‘A+’ rating in recognition of its strong financials and “stable outlook” after a tumultuous year in finance, Stadler claimed that this proved the company’s ability “to make the best possible use of the opportunities that arise.”
"This transaction will simplify Aegon's footprint and strengthen our balance sheet", stated Lard Friese, CEO. "We are sharpening our strategic focus and are concentrating on those countries and business lines where Aegon can create most value.
“I would like to thank our employees in Hungary, Poland, Romania and Turkey for their significant contribution to Aegon over the years. We believe that our businesses will benefit greatly from the vast experience of VIG, a leading insurance group in the region."
Aviva Investors launch $350m global climate credit fund
Aviva Investors has launched a climate transition global credit fund and has already allocated US$350m in strategic capital.
The funding, which has been provided by Aviva’s UK and Irish multi-asset funds, will be used to invest in companies offering goods and services that support climate change mitigation and the move towards a more sustainable future.
According to reports, the fund is in line with Aviva’s ESG philosophy on green policies and the United Nations sustainable development goals. It will be handled by portfolio managers Justine Vroman and Tom Chinery, as well as the noted climate specialist, Rick Stathers.
Aviva sustainable investment strategy
Companies excluded from the investment fund will be those entrenched in the fossil fuel industry, while enterprises that look at solutions to climate-related problems, such as sustainable transport, renewable energy and environmentally conscious lending, will be targeted.
Aviva Investors confirmed the goal is to capture transition-oriented companies with low decarbonisation and physical impact risk.
The initiative will also be benchmarked against the Bloomberg Barclays Global Aggregate Corporates Index, investing predominately in investment-grade companies and a small allocation of up to 5% in high-yield bonds.
Colin Purdie, Aviva Investors chief investment officer for credit, explained, "We can't pivot to a lower-carbon world if all we do is rule out the poor performers and only invest in companies that provide solutions to climate change. All companies need to adjust for a warmer, lower carbon world, which is why we felt it was important to use a wider transition lens to capture a larger set of businesses beyond those with obvious green credentials."
He said, "As investors, it is our responsibility to look beyond small pockets of green finance to engage and mobilise the liquidity of the wider credit market to assist in climate transition and the achievement of net zero carbon emissions."
Purdie added, "Companies that don't adjust their business models will be less attractive to investors and will present a less compelling investment case over time. Climate laggards may find that their financing becomes more expensive than that available to climate leaders."