The country’s second-biggest insurer Aviva plans to cut costs and exploit growth opportunities by centralising all its continental European operations in a holding company in low-tax Ireland.
As part of the plan, Aviva will also simplify the range of products it offers across 12 European businesses, and speed up new product launches, the company said in a statement on Thursday.
The company said: “Aviva will make significant efficiency gains and build competitive advantage in the region,”.
Aviva’s Europe chief executive Andrea Moneta said Ireland’s low corporate tax rate of 12.5 percent would cut the company’s overall tax bill, but stressed that the targeted efficiency gains did not depend on tax reductions.
“The programme is going to deliver a set of improvements in terms of revenues and costs, and there is also room for improvement in terms of the blended tax rate we have,” he said in an interview.
“Our plan has very minimal reliance on tax advantages.”
Aviva shares were 1.7 percent lower at 433 pence by 8:08 a.m. British time, while the FTSE 100 share index was down 1.3 percent.
The 12 European businesses being integrated do not include Aviva’s domestic unit, nor its operations in the Benelux countries, where Aviva is in the process of floating its Delta Lloyd subsidiary on the stock market.
