Aviva 2007 Annual Report Download - page 165
Download and view the complete annual report
Please find page 165 of the 2007 Aviva annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.-
1
-
2
-
3
-
4
-
5
-
6
-
7
-
8
-
9
-
10
-
11
-
12
-
13
-
14
-
15
-
16
-
17
-
18
-
19
-
20
-
21
-
22
-
23
-
24
-
25
-
26
-
27
-
28
-
29
-
30
-
31
-
32
-
33
-
34
-
35
-
36
-
37
-
38
-
39
-
40
-
41
-
42
-
43
-
44
-
45
-
46
-
47
-
48
-
49
-
50
-
51
-
52
-
53
-
54
-
55
-
56
-
57
-
58
-
59
-
60
-
61
-
62
-
63
-
64
-
65
-
66
-
67
-
68
-
69
-
70
-
71
-
72
-
73
-
74
-
75
-
76
-
77
-
78
-
79
-
80
-
81
-
82
-
83
-
84
-
85
-
86
-
87
-
88
-
89
-
90
-
91
-
92
-
93
-
94
-
95
-
96
-
97
-
98
-
99
-
100
-
101
-
102
-
103
-
104
-
105
-
106
-
107
-
108
-
109
-
110
-
111
-
112
-
113
-
114
-
115
-
116
-
117
-
118
-
119
-
120
-
121
-
122
-
123
-
124
-
125
-
126
-
127
-
128
-
129
-
130
-
131
-
132
-
133
-
134
-
135
-
136
-
137
-
138
-
139
-
140
-
141
-
142
-
143
-
144
-
145
-
146
-
147
-
148
-
149
-
150
-
151
-
152
-
153
-
154
-
155
-
156
-
157
-
158
-
159
-
160
-
161
-
162
-
163
-
164
-
165
-
166
-
167
-
168
-
169
-
170
-
171
-
172
-
173
-
174
-
175
-
176
-
177
-
178
-
179
-
180
-
181
-
182
-
183
-
184
-
185
-
186
-
187
-
188
-
189
-
190
-
191
-
192
-
193
-
194
-
195
-
196
-
197
-
198
-
199
-
200
-
201
-
202
-
203
-
204
-
205
-
206
-
207
-
208
-
209
-
210
-
211
-
212
-
213
-
214
-
215
-
216
-
217
-
218
-
219
-
220
-
221
-
222
-
223
-
224
-
225
-
226
-
227
-
228
-
229
-
230
-
231
-
232
-
233
-
234
-
235
-
236
-
237
-
238
-
239
-
240
-
241
-
242
-
243
-
244
-
245
-
246
-
247
-
248
-
249
-
250
-
251
-
252
-
253
-
254
-
255
-
256
-
257
-
258
-
259
-
260
-
261
-
262
-
263
-
264
-
265
-
266
-
267
-
268
-
269
-
270
-
271
-
272
-
273
-
274
-
275
-
276
-
277
-
278
Aviva plc
Annual Report and
Accounts 2007
161
Financial
statements
18 – Interests in, and loans to, joint ventures continued
(c) Long-term business undertakings
The principal joint ventures are as follows:
Country of
Proportion incorporation
Company Class of share held and operation
AVIVA-COFCO Life Insurance Co. Limited Ordinary shares of RMB1each 50.0% China
AvivaSA Emeklilik ve Hayat A.S
,. Ordinary shares of YTL1each 49.7% Turkey
CIMB Aviva Assurance Berhad Ordinary shares of RM1each 49.0% Malaysia
CIMB Aviva Takaful Berhad Ordinary shares of RM1each 49.0% Malaysia
First-Aviva Life Insurance Co., Ltd. Ordinary shares of NT$10 each 49.0% Taiwan
All investments in the above companies are unlisted. The shares in the Chinese company are held by the Company but all
the other investments are held by subsidiaries.
Details of these investments are as follows:
(i) China
The Group has a 50% holding in AVIVA-COFCO Life Insurance Company Limited, a life assurance company
incorporated and operating in China. These shares are held by the Company, with a share of net assets of £44 million
(2006: £18 million) and a fair value of £52 million (2006: £35 million).
(ii) Turkey
On 31 October 2007, the Group entered into a joint venture agreement with Aksigorta AS
,(“Aksigorta”), the insurance
company of the Sabanci Holding Group, to form a new Turkish life and pensions joint venture. Under the terms of the
agreement, the Group’s Turkish life and pensions business, Aviva Hayat ve Emeklilik A.S
,. (“Aviva HE”) merged with
Ak Emeklilik A.S
,. (“Ak E”), Aksigorta’s life and pensions business. The joint venture entered into an exclusive long-term
bancassurance agreement with Akbank TAS
,, Turkey’s second-largest privately-owned bank.
The Group and Sabanci jointly control the joint venture through equal shareholdings of 49.7%, with the remaining
0.6% being held by individual shareholders. The new company, AvivaSA Emeklilik ve Hayat A.S, began trading on
1 November 2007.
As consideration for its shareholding, the Group contributed the business of Aviva HE to the joint venture and paid
£49 million to Aksigorta. The transaction has been accounted for as an acquisition of a 49.7% joint venture and the
disposal of 50.3% of Aviva HE. Goodwill arising of £45 million, included in the carrying value of the joint venture, has
been calculated as follows:
(a) Acquisition of shareholding in joint venture
Purchase cost:
£m
Fair value of 50.3% of Aviva HE (see below) 85
Cash paid 49
Attributable costs 2
Total consideration 136
Fair value of 49.7% of Ak E’s identifiable net assets 91
Goodwill 45
Included in the fair value of Ak E's net assets were acquired value of in-force business of £34 million and a distribution
contract intangible asset, valued by an independent third party at £49 million, using post-tax cash flows and discount
rates. The intangible asset has been assessed as having a life of 15 years and is being amortised over that period.
The residual goodwill represents the value of the direct sales force and expected synergies.
The carrying value of the joint venture at the date of acquisition was as follows:
£m
Carrying value of 49.7% of Aviva HE’s net assets* 8
Fair value of 49.7% of Ak E’s net assets 91
Goodwill 45
Total carrying value 144
* Calculated as 49.7% of the total net assets of £17 million given in the table below.