Jobs are at risk at Bristol pensions company Friends Life after its directors agreed to sell the business to UK insurance giant Aviva for £5.6bn.
The deal will create the UK’s largest insurance, savings and asset management firm. The boards of the two businesses have been negotiating a deal for several months although it only recently became public. 
Finance industry watchers believe Friends Life, which employs hundreds of people at its showpiece office at Stoke Gifford, north Bristol, will bear the brunt of significant cost-cutting as the enlarged group reduces overheads and takes out duplication. Aviva confirmed jobs will go and said combining the two firms deal will save around £225m a year by the end of 2017.
The boards of both companies will now recommend the deal to shareholders. Under the deal Friends Life shareholders will own about 26% of the enlarged Aviva group.
Friends Life was formed in 2011 from the amalgamation of Friends Provident, most of AXA UK Life and Bupa Health Assurance. Aviva, which was created following the merger of CGU and Norwich Union in May 2000, also has an office in Bristol handling underwriting, claims assessments and other insurance tasks.
The firm made several hundred redundancies in Bristol three years ago when it closed an office at Trinity Quay.
Aviva chief executive Mark Wilson this morning described the Friends Life deal as “financially and strategically compelling”.
He added: “It is one of those rare transactions where the two organisations fit with surgical precision, building on each other’s strengths and addressing the challenges.”
