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LONDON/MILAN (Reuters) – Aviva AV.L is weighing a piecemeal sale of its Italian business which consists of two joint venture agreements focused on life insurance as well as general insurance policies handled by a network of agents, sources familiar with the matter said.

FILE PHOTO: Pedestrians walk past an Aviva logo outside the company’s head office in the city of London March 5, 2009. REUTERS/Stephen Hird/File Photo

The British insurer, which is also working on the possible sale of its French operations, holds a distribution agreement with UniCredit which expired this year, meaning no new policies are being sold through this network.

Aviva had also teamed up on a bancassurance partnership with Italian lender UBI Banca UBI.MI, which is being taken over by Intesa Sanpaolo ISP.MI.

Both joint venture platforms are being reviewed as part of Aviva’s plans to sell its Italian operations, the sources said.

The move comes after Aviva hired Morgan Stanley MS.N to launch an auction process for its Italian business as its new boss Amanda Blanc is shifting the insurer’s focus purely to its core operations in Britain, Ireland and Canada.

Aviva said in a statement that it was “in the very early stages of developing its strategy for its continental European and Asian businesses”.

The London-listed company owns a general insurance business in Italy which operates through a network of agents and could draw interest from corporate buyers including Germany’s Allianz ALVG.DE, France’s Axa AXAF.PA and Spain’s Mapfre MAP.MC, one of the sources said.

These assets are seen as the most attractive and could be valued between 200 million and 300 million euros ($233 million-$349 million), this source said, adding they would be sold as part of a separate process.

Aviva’s Italian general insurance business had net written premiums of 319 million pounds ($406.3 million) in 2019.

Meanwhile, UniCredit is seeking to take full control of its Aviva partnership ahead of a possible exit at a later stage, one of the sources said.

Another source said the bank was assessing several options and no final decision had been made.

Italian daily Il Messaggero reported earlier that UniCredit was ready to dissolve its life insurance partnership.

UBI is set to buy Aviva’s 80% stake in their joint venture in mid-2021 and Intesa will fold that business into its insurance arm.

Yet the “back books” portfolios of the UBI-Aviva joint venture – which consist of existing policies, with no new ones being issued – are expected to be sold to private equity funds, the sources said.

($1 = 0.8595 euros)

($1 = 0.7851 pounds)

Reporting by Pamela Barbaglia in London and Stephen Jewkes in Milan; additional reporting by Valentina Za, Carolyn Cohn and Giulia Segreti; editing by Emelia Sithole-Matarise

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