EMBATTLED insurance giant Aviva has unveiled a major sell-off plan as part of a broader turnaround in the wake of the resignation of its chief executive Andrew Moss.
Executive chairman John McFarlane said a review of 58 divisions had identified 16 weak performers that would be sold, including the bulk annuities business in the UK.
McFarlane took over leadership in May when Moss stood down following a shareholder revolt over executive pay and the group’s shares performance.
The former bank chief said the proposals would create “a leaner and more agile” business with a “less layered and bureaucratic management style”.
Moss left the group after 59% of votes failed to back Aviva’s pay report in one of the biggest protest votes of the so-called “shareholder spring”.
Around 10% of shareholders went against or withheld their votes on the re-election of Moss.
Aviva’s share price declined around 60% during Mr Moss’s near five-year tenure at the helm.
McFarlane unveiled a series of concerns flagged by shareholders, alongside the disappointment over the shares performance.
He said shareholders found the business difficult to understand and feel it has expanded the international scope too far. Shareholders feel Aviva is too exposed to the eurozone, he added.
Mr McFarlane also said investors find its financial statements to be “cumbersome and difficult to understand”.
In addition to the businesses flagged for sale, Aviva highlighted 27 segments requiring significant improvement, such as Ireland General Insurance.
Other businesses set for disposal are a number of small Italian partnerships and its South Korea division. To execute the turnaround, McFarlane has also put in place a new management structure.
David McMillan will take up a new appointment as director, group transformation after heading up the UK and Ireland General Insurance division. He will be replaced by Robin Spencer.
In turn, John Lister will replace Mr Spencer in a new expanded role as group chief capital and risk officer. The hunt for a chief executive is ongoing.
The group expects the bulk of the changes to take place over the next 12 months, but expects some to extend through to the end of 2013.
McFarlane added: “Things are tough and the environment is challenging. However, I am confident we will be successful.”