Aviva share price: Group to develop insurance company in Hong Kong

on Jan 20, 2017
Updated: Oct 21, 2019
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Aviva (LON:AV) has teamed up with investment management firm Hillhouse Capital and Chinese internet services giant Tencent Holdings to develop a digital insurance company in Hong Kong, the London-listed group has said. The move comes hot on the heels of an announcement of an organisational shake-up which will see the company bring its UK insurance businesses together.

Aviva’s share price has gained ground in today’s session, having added 0.42 percent to 478.30p as of 08:24 GMT, outperforming the broader London market, with the benchmark FTSE 100 index having fallen into the red and currently standing 0.12 percent lower at 7,200.15 points. The group’s shares have lost about 1.6 percent of their value so far this year, as compared with a near one-percent rise in the blue-chip index this year.

Aviva announced in a statement this morning that it had agreed to develop an insurance company in Hong Kong, which will focus on digital insurance, together with Hillhouse Capital and Tencent Holdings. As part of the agreement, Hillhouse and Tencent will acquire shares in Aviva Life Insurance. Following completion of the transaction, Aviva and Hillhouse will each hold 40 percent and Tencent will hold 20 percent shareholdings in Aviva Hong Kong.

The new deal comes after earlier this week, Aviva announced that it was bringing its UK insurance businesses together, noting that it was entering a new phase of its transformation under chief executive Mike Wilson. The group’s Aviva Investors, Aviva Asia and the Digital businesses meanwhile will remain separate entities.
In analyst ratings, earlier this month, JPMorgan Chase & Co, which is bullish on Aviva with an ‘overweight’ rating, boosted its price target on the shares from 506p to 553p. According to MarketBeat, the FTSE 100 insurer currently has a consensus ‘buy’ rating an average valuation of 524.61p.
As of 09:39 GMT, Friday, 20 January, Aviva plc share price is 477.40p.

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