Aviva share price climbs higher amid shake-up reports

on May 28, 2019
Updated: Mar 11, 2020

Shares in Aviva (LON:AV) have climbed higher in London in today’s session amid reports that the company is preparing to unveil a shake-up. The news comes after the company recently unveiled management changes, having promoted insider Maurice Tulloch to the top job earlier this year.

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As of 14:03 BST, Aviva’s share price had added 1.21 percent to 409.20p, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.10 percent higher at 7,285.31 points. The group’s shares have given up more than 22 percent of their value over the past year, as compared with about a 5.6-percent dip in the Footsie.

Aviva preparing shake-up

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The Financial Times reported today that Aviva was preparing to unveil a big shake-up of its UK business next week under new chief executive Maurice Tulloch. The newspaper quoted observers as commenting that one option was to split the UK business — Aviva’s largest operation — into two parts. One would contain the life insurance division, the other would be non-life insurance, such as home and car cover.

The move, however, would reverse the blue-chip insurer’s decision in 2017 to merge its two main businesses under its former chief executive Mark Wilson. The FT notes that the new CEO is believed to want to simplify the group, telling last week’s annual meeting it was ‘still too complex’. He is also likely to announce a push to make Aviva more efficient, with costs having climbed in recent years.

Analysts on FTSE 100 group

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The 16 analysts offering 12-month targets for the Aviva share price for the FT have a median target of 492.50p, with a high estimate of 575.00p and a low estimate of 430.00p. As of May 24, the consensus forecast amongst 18 polled investment analysts covering the blue-chip group has it that the company will outperform the market.

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