The price Aviva Asigurari de Viata paid for mutual fund manager Certinvest (purchased in early September) was much higher than normal for such a company on foreign markets, explains Shah Rouf.
"For Aviva, the value of the deal was not high, but for a firm of Certinvest's size the sum was significant. Normally, on international markets, the price for this type of deal stands at 4-5% of managed assets, namely around 1.5m euros, however, in this case the sum was much higher. We could not apply this type of assessment to Certinvest, because it is a developing business, which will witness considerable growth in the following years," states Rouf.
Besides Certinvest, the insurer's shortlist included another two investment managers. Altogether, takeover negotiations and the completion of the deal took around six months.
"Now, we are seeking synergies between our three businesses - life insurance, private pensions and investment management. We will not change Certinvest's name because it is a well-known market brand. We will distribute the company's products through Aviva's sales team and we plan to share Certinvest expertise with other pension funds on the market. If we get good yields, I cannot see why other pension managers cannot also benefit from this expertise," explains Aviva's general manager.
He believes the three domestic operations of the British group will be legally distinct, but will have joint HR, marketing or distribution departments, most likely from the start of next year.
Rouf considers the base of customers who joined the Aviva's pension fund will contribute to the sales growth of life insurance.
"(...) Private pensions create a long-term relationship, of 20-30 years, between customers and the company, so we will have time to present other products, as well," states Rouf.
He estimates the group's life insurance sales in Romania will advance by around 40%, with a similar trend also expected this year, to around 36 million euros.
The best-selling policies are unit-linked insurance ones. A portion of Aviva's sales are conducted through banks, such as BRD-SocGen, ABN Amro and Credit Europe Bank.
However, Shah Rouf adds that although Aviva has general insurance operations on other markets, entering this segment is not part of Aviva Romania's strategy.
"The group only enters the non-life insurance segment if it can attain a top five position. If this is not possible, we are not interested in this activity," explains Rouf.
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