Global insurance giant, Aviva plc, today entered the Sri Lanka insurance market by acquiring a controlling stake in the highly successful local insurance company, Eagle Insurance Limited. With this acquisition Aviva and NDB will be the major share holders of Eagle controlling a total of 78.42 % with effective control of 51% and 27.42% respectively.

Eagle was previously owned to the extent of  87.27% of its shares by NDB Finance Lanka (Pvt) Ltd (NFL).  NFL in turn was wholly owned by Capital Development & Investment Co Ltd (CDIC), whose principal owner was NDB Bank Ltd (75.6%)

Under this deal, CDIC sold 58.44% of its shares in NFL to Aviva, thereby reducing its holding in NFL to 41.56%. 

Aviva is the world’s oldest insurance group, with a history dating back to 1696. The Group has 60,000 employees serving 30 million customers in over 25 countries with more than Sterling Pounds 290 billion assets under management.  Aviva Plc is the largest insurer in the UK and one of the leading providers of life and pension products to Europe. It is also the sixth largest insurance company in the world. Its many activities include long term insurance, fund management, and general insurance.

Aviva also focuses on bancassurance worldwide and has a proven track record of successful bancassurance relationships. It has major partnerships with leading banks across the globe. Aviva is a leading bancassurer in countries such as UK, France, Italy and Spain.

“Aviva has identified Asia as a high growth market. Accordingly, it entered India in 2002, and has rapidly grown into being one of the leading life insurers in the Indian market. This acquisition reconfirms Aviva’s strategic commitment to grow in Asia.” said, Philip G  Scott  Group Executive Director of Aviva Group.
Speaking on the occasion, Stuart Purdy, Managing Director, Aviva Life Insurance Company India Pvt. Ltd. said, “ We are really excited about our entry into the Sri Lankan market. Aviva has grown rapidly in India by combining its global expertise with the local talent. We are now looking to replicate that in Sri Lanka. Eagle Insurance has high quality management and corporate governance and a core value system that is in line with Aviva’s philosophy. We are looking at synergies between our operations overseas and Sri Lanka. Eagle will benefit from Aviva’s expertise in Bancassurance, and Aviva’s modern products, while Aviva will benefit by leveraging Eagle’s world class direct distribution model.”

Chairman NDB Bank Mr. S K Wickremasinghe commenting said that Aviva is one of the largest insurance companies in the world, and it is ranked 35th in the Fortune 500 list of companies. It brings all the technical expertise that we could possibly want, both in the areas of life and non-life insurance including their worldwide reinsurance capability. This partnership will be an excellent deal for the share holders of NDB Bank both from the financial perspective and future business of the company.   It is also more than Rs.700 million higher than the next best offer.

Explaining the rationale for bringing in Aviva to be the major share holder of Eagle, the CEO of NDB Bank Nihal Welikala stated “We are proud to be instrumental in attracting a world class insurance company to Sri Lanka, which is evidence of the attractiveness of this country as a global investment destination.  We previously worked in partnership with Zurich Insurance Co Ltd which was the majority owner of Eagle Insurance until December 1999.  The NDB Group bought their shares when they divested as part of their global geographic rationalisation in July 2003. We have since been looking for an international partner to replace them in this specialist field.  Aviva also has formidable expertise in the areas of bancassurance and asset management, which will be of enormous value to the business.  We look forward in particular to learning from the distribution expertise of Aviva and working the synergies between Eagle and NDB Bank’s growing consumer business.

Deepal Sooriyaarachchi, the Managing Director of Eagle Insurance added, “This certainly is a new beginning for us at Eagle. Once again Eagle becomes the only international composite insurer to operate in the island. By being a member of global insurance networks since its inception, Eagle brought new products, concepts and best practices to the country, and to an industry which was liberalized only in 1989. With Aviva, we will be introducing novel concepts in products, services and distribution, adding value to all our stake holders. While providing better products and services to clients, the agency force and staff too will be able to benefit from the people development initiatives of the Aviva group. Eagle is particularly looking at enhancing its capability in the area of bancassurance with the help of Aviva. There will be many other areas where Eagle will work closely with the global operations of Aviva”.