Cevian has purchased approximately 195 million Aviva shares to become one of the top three shareholders of the British insurance giant.
Swedish activist investor Cevian now holds a 4.95% stake in British insurer Aviva.
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Aviva has been divesting its non-U.K. business. Cevian expects it to continue on that path, and return £5bn to shareholders next year.
Christer Gardell, managing partner at Cevian, was quoted by Bloomberg as saying that Cevian plans to use the stake to aid in cost-cutting and shareholder return.
Gardell told the publication that Aviva’s costs are “moving in the right direction ” but there is more potential to return £500m in cuts by 2023.
Gardell said that Aviva’s share price could rise to £8, which is almost double its value today and four times the low it reached in March 2020.
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By GlobalDataThe dividend could move to 45 pence, roughly twice its current level, he added.
Cevian, which has $16bn under management, has already purchased stakes in rival insurer RSA and Old Mutual.
Cevian Capital partner Niko Pakalen told Bloomberg, “We’ve followed Aviva closely for nearly a decade, both as a peer of our former core holding, RSA, and as an investment candidate in its own right.”
In March 2021, Aviva decided to sell its remaining businesses in Italy for a combined value of €873m.
Few weeks before this announcement Aviva announced the divestment of its operations in France and Turkey.
