Allianz Group has completed its £500 million purchase of a 49% stake in Liverpool Victoria’s (LV=) UK general insurance businesses.
The sale is the first stage in the creation of the insurers’ joint venture and strategic partnership that was announced in August.
The venture creates a general insurance business with more than six million customers and gross premiums written in excess of £1.7 billion.
It allows the insurers to take a leading role in the growing UK retail sector by creating a strong and customer-centric insurer in the personal home and motor insurance markets.
The second stage of the transaction will take place in 2019 when Allianz will pay an additional £213 million for a further 20.9% stake in LV=’s general insurance businesses through an agreed, forward purchase based on a total valuation of £1.02 billion for 100%.
LV= has a put option under which it can sell all or part of its remaining shares to Allianz at any time.
Speaking in August when the deal was announced, Oliver Bäte, CEO of Allianz, commented: “I am thrilled to join forces with LV=, one of UK’s most respected and loved brands. This partnership will first and foremost benefit our customers who will have access to an expanded range of products backed by the financial strength of Allianz. We value LV=’s strong brand and market positioning.”
Richard Rowney, chief executive of LV=, added: “I am delighted to announce this joint venture with Allianz, which will see us create the third largest personal insurance business in the UK. With this deal, LV= has a positive future in both general insurance and life and pensions.”
“The strategic partnership with Allianz will allow us to continue to benefit from a growing personal insurance business while also enabling us to strengthen our capital position, leaving us well placed to continue to expand our Life and Pensions business and pursue new digital opportunities.”