Aegon to sell its Central and Eastern European business to VIG
Aegon has agreed to sell its insurance, pension and asset management business in Hungary, Poland, Romania and Turkey for EUR 830 million to Vienna Insurance Group AG Wiener Versicherung Gruppe (VIG).
“This transaction will simplify Aegon’s footprint and strengthen our balance sheet”, said Lard Friese, CEO of Aegon. “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.”
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The proceeds amount to EUR 830 million and represent a multiple of 2.6 times the book value on June 30, 2020. This will result in an increase in IFRS equity of EUR 505 million of which EUR 362 million will be recognized as book gain based on the balance sheet position on June 30, 2020. The total net underlying earnings of Aegon’s businesses in Central and Eastern Europe amounted to EUR 54 million for 2019, implying a transaction multiple of 15 times net underlying earnings. As a result of the transaction, the Group Solvency II ratio is estimated to improve by approximately 8 percentage points.
The proceeds will be upstreamed to the Group and increase Aegon's financial flexibility to execute on its strategic priorities, including deleveraging. On December 10, 2020, Aegon will provide an update on its strategy and financial targets at its virtual Capital Markets Day.
The transaction is subject to regulatory and antitrust approvals customary for transactions of this nature and is expected to close in the second half of 2021.
Aegon’s roots go back more than 175 years – to the first half of the nineteenth century. Since then, Aegon has grown into an international company, with businesses in more than 20 countries in the Americas, Europe and Asia. Today, Aegon is one of the world’s leading financial services organizations, providing life insurance, pensions and asset management. Aegon’s purpose is to help people achieve a lifetime of financial security. More information on aegon.com.
The statements contained in this document that are not historical facts are forward-looking statements as defined in the US Private Securities Litigation Reform Act of 1995. The following are words that identify such forward-looking statements: aim, believe, estimate, target, intend, may, expect, anticipate, predict, project, counting on, plan, continue, want, forecast, goal, should, would, could, is confident, will, and similar expressions as they relate to Aegon. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Aegon undertakes no obligation to publicly update or revise any forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which merely reflect company expectations at the time of writing. Actual results may differ materially from expectations conveyed in forward-looking statements due to changes caused by various risks and uncertainties. Such risks and uncertainties include but are not limited to the following: