Aviva To Sell Australia, New Zealand Operations to IAG

Aviva, PLC, once known as the insurance company CGNU, has agreed to sell its general insurance operations in Australia and New Zealand to the Insurance Australia Group (IAG) for A$1.86 billion (approximately U.S. $1 billion).

Negotiations between the two companies have been in progress for several days, and IAG shares have consequently been suspended while the talks continue. A formal announcement is expected to be made tomorrow.

IAG ranks as Australia’s largest general insurer, and Aviva’s CGU Australia is the third largest in terms of premiums written, which could cause some problems with obtaining the requisite regulatory approvals.