Cevian builds a price in Aviva to force it to reduce the price and pay $ 5bn

Europe’s largest investor Cevian has built a 5% stake in Aviva and is forcing the FTSE 100 insurance to reduce costs and repay $ 5bn to its shareholders.

“Aviva has been well-run for many years, and its high-end businesses have reimbursed for the high cost and a number of bad choices,” said Christer Gardell, co-founder of Cevian.

Shares in Aviva rose 3.3% to $ 4.24 after Cevian released the document Tuesday morning.

Instead of promoting a change of leadership at the top of the London-based group, Cevian is urging Amanda Blanc’s chief executive to implement some of the announcements since its inception. about a year ago.

Aviva agreed last year to sell Eight unsustainable businesses, raising about $ 8bn, in an attempt to resume markets in Britain, Ireland and Canada. The global goals that its former leaders pursued were criticized by some experts as unethical and left the organization with a very high price tag.

The company “has the potential to become a stable and well-known market leader who generates profitable growth, makes a lot of money, and is well-regarded in the stock market,” Gardell said.

Cevian, who oversees more than $ 16bn in lieu of nearly 350 pensions, donated by other retailers around the world, began building its Aviva price earlier this year, according to someone familiar with the matter. At 4.95%, the Swedish group is now the second largest shareholder of Aviva, after BlackRock.

Aviva has promised a great return and reduced price as its middle timber a change of pace under Blanc, who has told investors that his mantra must go fast.

However, Cevian wants a $ 5bn refund for the distribution or refund of capital that the insurer has overtime. The Security Council also believes that deforestation will continue, calling for a reduction of more than $ 500m from Aviva’s annual price by 2023, compared to the manager’s $ 300m target. It also promotes a well-rounded management system, according to the person familiar with the matter.

There have been good talks between Cevian and Aviva officials in recent months, according to people familiar with the matter, who added that the fund does not want a seat.

The share price of Aviva should rise by more than $ 8 in less than three years, depending on the annual average of 45p, Cevian estimates. An insurance agent can also benefit if the interest rate starts to rise, says the moneylender.

Aviva shares sell seven times for a fee, according to what S&P Capital IQ did, at a discount compared to the British subsidiaries including Legal & General, Phoenix Group and Direct Line, which sell several times or more.

Aviva said she has “done very well in the last 11 months” and has remained “steady” in improving her performance.

“We communicate regularly with investors and welcome any suggestions that may lead us to our goal of providing long-term sharing opportunities,” he added.

Aviva is not the first UK insurance company that Cevian manages. The money ran a campaign against RSA, which ended his sale at Tryg in Canada and Tryg last week.

Cevian, who calls himself a “freedom fighter”, holds a share for about five years and owns between 10 and 15 companies.