FINLAND - Aon Finland Oy has sold its individual life and pension activity to a management buyout, with the new operation being known as Bon Life Oy.
“Aon does not have this type of business anywhere else in the world and as we are trying to be more strategically disciplined and compliant we are concentrating on those businesses that are core activities,” Steen Parsholt, Aon managing director for Nordic countries, told IPE.
“Therefore the likelihood would be that we would under-invest in the business and would not be the right and proper owners.
“We realised that the people who involved in and who built the business successfully would be better off in ownership as they would have a higher focus and for them it would be a higher priority,” Parsholt said.
Aon’s decision to sell off the operation was linked to legislative changes that come into effect in March, Bon Life CEO Juha Rautiainen told IPE.
Rautiainen, who was brought in to Aon to start and grow the business nine years ago, said that the buyout had the support of two leading Finnish independent financial groups, Thominvest Oy and Hermitage & Co Oy. He said that the management would hold 20% of Bon Life and its backers 40% each.
He said Aon and Bon Life had agreed not to disclose the price of the transaction.
The business would change from being an Aon-linked broker to a multi-tied agent, which should give more room for growth, Rautiainen said.
“The turnover of the transferred business is estimated at €5.8m for the year 2004,” he added. “The business has 50% of the Finnish market for supplementary pension and investment policies to individuals who are not in a company scheme.”
Aon’s core benefits activity encompasses consultancy and the arrangement of company schemes.