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Aviva to cut 1,500 staff following Friends Life merger

Aviva is preparing to cut 1,500 roles from the new company created following the planned merger with Friends Life.

In a note sent by the insurer to shareholders ahead of its March annual general meeting, Aviva says the cuts – out of a combined workforce of around 31,500 – would be part of a cost savings “in those areas where it identifies there to be duplication”. Aviva says no specific teams, roles or locations have been indentified at this stage.

Aviva says it aims to make £225m of savings in total.

In November, analyst BNP Paribas predicted 40 per cent of Friends Life’s staff costs would be cut as part of the deal.

An Aviva spokesman says: “This acquisition is financially and strategically compelling. It will increase our cash flows, reduce our leverage and support continued growth in our dividend. It also secures our leadership position in our home market and gives greater flexibility to drive growth in other parts of the Aviva group.

“As a result of this transaction, Aviva expects to deliver approximately £225m of annual savings by the end of 2017. This may result in a reduction of approximately 1,500 roles from across the enlarged Aviva group of approximately 31,500 people. We appreciate that this news may be disconcerting for employees and we would look to ensure that any redundancies are kept to a minimum wherever possible, by using vacancies and natural turnover, for example.

”At this stage, no specific teams, roles or locations have been identified as the proposed transaction has not completed. When we are clearer on this, following completion of the deal, we will fully engage and consult with employees and their representative bodies.”

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