Aegon to combine its Dutch operations with a.s.r.

The Hague, October 27, 2022 – Agreement marks pivotal step in the direction of Aegon’s ambition to construct leaders in chosen markets

• Combination creates a pacesetter within the Dutch pension, life, and non-life insurance markets 
• Clear and compelling strategic and monetary rationale, with vital synergies and long-term advantages for patrons, business companions, workers, and shareholders 
• Aegon to obtain a 29.99% strategic shareholding0F¹⁾ in a.s.r. with related governance rights and EUR 2.5 billion in money proceeds  
• Transaction permits Aegon to speed up its technique of releasing capital from mature companies and to turn into a pacesetter in markets the place Aegon is properly positioned for development
• Intention to use money proceeds to return EUR 1.5 billion capital to shareholders and cut back leverage by up to EUR 700 million constant with disciplined capital administration method
• Progress on its transformation permits Aegon to improve its 2023 dividend per share goal from round EUR 0.25 to round EUR 0.30

Aegon publicizes right this moment it has reached an settlement with a.s.r. to combine its Dutch pension, life and non-life insurance, banking, and mortgage origination actions with a.s.r. The mixture will create a number one Dutch insurance firm. This step permits Aegon to speed up its technique and represents a serious step in its ambition to turn into a pacesetter in its chosen markets. Aegon will obtain EUR 2.5 billion in gross money proceeds, and a 29.99% strategic stake in a.s.r., with related governance rights. Aegon’s Dutch asset administration actions will stay a part of Aegon’s world asset supervisor. Aegon will enter right into a long-term asset administration settlement with a.s.r. to handle components of the mixture’s common account investments, the investments of the Premium Pension Institution (PPI) providing of Aegon Cappital, and a.s.r.’s mortgage funds.

“Today’s announcement marks a major milestone in the history of our company and in our long-term ambition to create leaders in our chosen markets”, stated Lard Friese, CEO of Aegon. “Both Aegon and a.s.r. are deeply rooted in Dutch society and share a long and rich history. Thanks to the hard work and dedication of our employees, Aegon the Netherlands has been able to improve its performance in recent years. We’re now building on that success by creating a Dutch insurance leader. I’m convinced that the combination of our companies is in the best long-term interest of all stakeholders and Dutch society at large. Customers of both companies will benefit from a more diversified product offering and strong distribution.

“This transaction provides a unique opportunity to accelerate both the return of capital to shareholders and our strategy of investing in markets where we are well positioned for growth. Our priority continues to be to further improve our operational performance and grow profitably. The increased focus and resources resulting from this transaction, will place us in a better position for the future growth of the company.”  

Jos Baeten, CEO of a.s.r. stated: “I am pleased to announce today that a.s.r. and Aegon the Netherlands, two renowned Dutch companies, deeply rooted in Dutch society, will create a leader in Dutch insurance. Together we will form a sustainable, leading insurer and strengthen our market position as the number two insurer in the market. Given the joined strength of both companies, the company will provide a good home for all Aegon the Netherlands employees, customers, and relations. As employees of a.s.r., we will work with the new colleagues on the future of this combination. The starting point will be, one company, one culture, by leveraging the best of both organizations. We look forward to welcoming all employees, customers, and relations of Aegon the Netherlands in the near future.”

¹ Value of 29.99% stake is EUR 2.4 billion based mostly on the closing worth of a.s.r.’s shares on October 26, 2022 and 57 million shares to be obtained by Aegon upon closing of the transaction earlier than any potential fairness providing by a.s.r. as a part of the funding of the transaction.

Compelling strategic rationale 
Combining the 2 corporations will end in a powerful well-diversified Dutch insurance firm that can be in a position to ship a broad vary of engaging services and generate engaging shareholder returns.

The mixed group will: 

• have a number one place within the Dutch pension market. This will lead to extra engaging worth propositions to clients as the corporate is properly positioned to seize alternatives from the upcoming pension reform;  
• turn into the market chief in incapacity insurance and the quantity three participant in property and casualty insurance, facilitating a extra aggressive product providing; 
• have enhanced scale within the origination and servicing of Dutch mortgages, creating the chance for extra streamlined and improved operations; 
• have stronger distribution actions by combining Aegon’s and a.s.r.’s experience, sources, and platforms on this space; and
• ship vital synergies via the mixing of the closed particular person life portfolios of the 2 corporations into one platform.

The mixture can be properly positioned to additional prolong its position within the Dutch insurance market within the area of sustainability and ESG and contribute to discovering options to the principle challenges society faces which have a transparent relationship with the core actions of the brand new mixture.

Combining the 2 corporations is predicted to lead to substantial price synergies and diversification advantages. Aegon will profit from a.s.r.’s improved working capital era and capital synergies via its 29.99% stake within the firm. Aegon will convey to a.s.r. vital danger administration capabilities and speed up the implementation of a Partial Internal Model for the calculation of the Solvency II required capital of the mixture.

Leveraging Aegon Asset Management’s capabilities  
Aegon has agreed an unique long-term partnership with a.s.r. to handle the illiquid investments which are a part of the final account of the mixed companies. In addition, it’s going to proceed to be the asset supervisor for the investments of Aegon Cappital’s PPI proposition and can take over the administration of a.s.r.’s mortgage funds. Through these steps, Aegon Asset Management will additional strengthen its place as a supplier within the Dutch market of fiduciary companies, retirement multi-assets & options, fastened earnings, together with various fastened earnings investments and accountable investing. 

Governance of mixture 
Aegon N.V. can be a 29.99% strategic, supportive shareholder in a.s.r., permitting Aegon to take part within the monetary advantages that the mixture will convey. Furthermore, Aegon can have the precise to nominate two candidates for the a.s.r. Supervisory Board. Lard Friese, CEO of Aegon N.V can be nominated as a non-independent member, and Danielle Jansen Heijtmajer, Chair of the Supervisory Board of Aegon the Netherlands, can be nominated as an unbiased member of the Supervisory Board of a.s.r.. The non-independent member has an affirmative vote inside a.s.r.’s Supervisory Board on sure subjects, in line with the dimensions of Aegon’s shareholding.

Integration and group of corporations 
The actions of a.s.r. and Aegon the Netherlands can be built-in after closing of the transaction to maximize the potential of the 2 companies and totally profit from their mixed attain, scale, and sources. The integration is predicted to influence workers in each corporations. The integration can be largely accomplished inside three years, and the intention is to decrease the variety of redundancies via pure attrition and by serving to individuals to the best extent doable to discover jobs both inside or exterior of the mixture. The course of can be executed in a good, diligent, and open means, respecting the skills and strengths of individuals in each organizations. Employees of the mixture will profit from the sharing of greatest practices and better long-term profession alternatives inside a bigger, extra diversified Dutch firm. 

The a.s.r. model would be the main model of the mixture. The Aegon model will stay in use within the pension and mortgage markets for 3 years after closing of the transaction. There can be no change for the manufacturers of Aegon’s different entities, together with TKP, Knab, Robidus and Nedasco. 

Accelerating transformation
The transaction represents a serious step within the transformation of Aegon, constructing on the profitable execution of the technique outlined on the Capital Markets Day of December 2020 to create leaders in chosen markets. The transaction kinds a pacesetter within the Dutch insurance market and permits Aegon to improve its give attention to creating advantaged companies in chosen markets exterior the Netherlands.

In the US, Aegon will construct upon Transamerica’s main positions in each particular person life insurance options and the office pension business, investing capital to profitably develop its market share in chosen product strains. Additionally, Transamerica will proceed to take administration actions designed to additional enhance the risk-return profile of the business. In the UK, Aegon’s ambition is to proceed to profitably develop each the Retail and Workplace channels of its main platform business by bettering its buyer propositions, service capabilities and digital expertise for advisors, employers, and clients. The transaction permits Aegon Asset Management to strengthen its place in retirement-related funding options, various fastened earnings investments and accountable investing, and to construct management in these areas. In its development markets, Aegon will proceed to look to make investments capital in value-added development alternatives. More particulars can be shared on the plans to profitably develop the strategic companies in Aegon’s core markets, its development markets, and its world asset supervisor at a Capital Markets Day within the second quarter of 2023. 

Use of proceeds and monetary implications  
Aegon anticipates that it’ll return EUR 1.5 billion of the money proceeds to shareholders, barring unexpected circumstances, to offset the dilutive impact of the transaction on free money circulation per share. Furthermore, the corporate intends to cut back its gross monetary leverage by up to EUR 700 million. 

A precedence for Aegon transferring ahead is to drive sustainable, worthwhile development for Transamerica and to execute upon further in-force administration actions designed to enhance the risk-return profile of the business. It is anticipated that this may require funding and subsequently Aegon expects to preserve its Cash Capital on the Holding above the center of the working vary of EUR 0.5 billion to EUR 1.5 billion within the close to time period. Surplus Cash Capital on the Holding above the working vary can be topic to continued disciplined capital administration, whereby capital that isn’t used for value-added development alternatives can be returned to shareholders over time. 

Update on monetary targets; improve in dividend per share  
On completion of the transaction, Aegon will exchange its full possession of the money circulation and income of its Dutch companies with its 29.99% strategic stake in a.s.r.. In the close to time period, that is anticipated to translate into decrease free money circulation, bettering over time as synergies emerge from the mixture. On completion of the capital return to shareholders and realization of the synergies, Aegon anticipates that its free money circulation on a per share foundation can be increased than pre-transaction ranges. 

The progress that Aegon has made on its transformation permits the corporate to improve its pay-out ratio and rebase the focused dividend per share over 2023 from the present degree of round 25 eurocents to round 30 eurocents.

All different monetary targets can be up to date sooner or later. 

The transaction is predicted to cut back IFRS shareholders’ fairness by EUR 3.3 billion based mostly on the steadiness sheet place on June 30, 2022. This consists of the influence from the settlement of a tax place at closing of the transaction, which isn’t anticipated to have a cloth influence on Aegon’s Cash Capital on the Holding. 

Group supervision implications 
Aegon will interact with its school of supervisors on the implications for group supervision upon closing of the supposed transaction. Regardless of the end result, Aegon intends to preserve its head workplace within the Netherlands. Its shares will stay listed on Euronext in Amsterdam and the New York Stock Exchange.

Indicative timelines 
The closing of the transaction is topic to customary situations, together with regulatory and antitrust approvals, shareholder approvals, and the completion of the works council session processes of each Aegon and a.s.r..

Aegon will convene an Extraordinary General Meeting of Shareholders (EGM) and request approval for the proposed mixture between Aegon the Netherlands and a.s.r.. The EGM is predicted to be held on January 18, 2023. The Board of the Association Aegon has been knowledgeable of Aegon’s ambition to speed up its technique and the proposed mixture with a.s.r.. The Board is supportive and can search the approval from its members for its assist.

Based on the required steps, and mandatory approvals, the transaction is predicted to shut within the second half of 2023.

About Aegon

Aegon is an built-in, diversified, worldwide monetary companies group. The firm provides funding, safety, and retirement options, with a strategic give attention to three core markets (the United States, the United Kingdom, and the Netherlands), three development markets (Spain & Portugal, Brazil, and China), and one world asset supervisor. Aegon’s function of Helping individuals dwell their greatest lives runs via all its actions. As a number one world investor and employer, the corporate seeks to have a constructive influence by addressing essential environmental and societal points, with a give attention to local weather change and inclusion & variety. Aegon is headquartered in The Hague, the Netherlands, and listed on Euronext Amsterdam and the New York Stock Exchange. More info may be discovered at aegon.com.

About a.s.r.

a.s.r. Nederland N.V. ranks among the many high 3 insurers within the Netherlands. a.s.r. provides services within the fields of insurance, pensions and mortgages for customers, self-employed individuals, and employers. In addition, a.s.r. is lively as an asset supervisor for third events. a.s.r. is listed on Euronext Amsterdam and included within the AMX Index. For additional info please go to www.asrnl.com.

Additional info

Conference name analysts and traders

Today, at 10:00 a.m. CET, Aegon’s administration will host a convention name for analysts and traders. The convention name and Q&A may be adopted through a dwell audio webcast on aegon.com. A replay can be accessible as quickly as doable after the convention name on aegon.com.

To be part of the convention name, you have to to register through the next registration hyperlink. Directly after registration you’ll obtain an electronic mail with the decision particulars and a private pin to enter the convention name. 
 
Call particulars
NL: + 31 20 795 2755
UK: + 44 20 8610 3526
US: + 1 646 307 1951
Passcode:  you’ll obtain a private pin upon registration

Joint digital press convention

Today at 08:00 hrs. CET, Lard Friese, CEO of Aegon N.V., and Jos Baeten, CEO van a.s.r. will host a joint digital press convention. Please, comply with this hyperlink to be part of the press convention.

Forward-looking statements

The statements contained on this doc that aren’t historic details are forward-looking statements as outlined within the US Private Securities Litigation Reform Act of 1995. The following are phrases that establish such forward-looking statements: intention, consider, estimate, goal, intend, might, count on, anticipate, predict, undertaking, relying on, plan, proceed, need, forecast, objective, ought to, would, may, is assured, will, and comparable expressions as they relate to Aegon. These statements might comprise details about monetary prospects, financial situations and tendencies and contain dangers and uncertainties. In addition, any statements that refer to sustainability, environmental and social targets, commitments, objectives, efforts and expectations and different occasions or circumstances which are partially depending on future occasions are forward-looking statements. These statements aren’t ensures of future efficiency and contain dangers, uncertainties and assumptions which are tough to predict. Aegon undertakes no obligation, and expressly disclaims any obligation, to publicly replace or revise any forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which merely mirror firm expectations on the time of writing. Actual outcomes might differ materially and adversely from expectations conveyed in forward-looking statements due to adjustments brought on by numerous dangers and uncertainties. Such dangers and uncertainties embody however aren’t restricted to the next:

• Unexpected delays, difficulties, and bills in executing towards our environmental, local weather, variety and inclusion or different “ESG” targets, objectives and commitments, and adjustments in legal guidelines or rules affecting us, corresponding to adjustments in knowledge privateness, environmental, security and well being legal guidelines;
• Changes generally financial and/or governmental situations, significantly within the United States, the Netherlands and the United Kingdom;
• Civil unrest, (geo-) political tensions, navy motion or different instability in a rustic or geographic area;
• Changes within the efficiency of monetary markets, together with rising markets, corresponding to with regard to:         
  • The frequency and severity of defaults by issuers in Aegon’s fastened earnings funding portfolios;
  • The results of company bankruptcies and/or accounting restatements on the monetary markets and the ensuing decline within the worth of fairness and debt securities Aegon holds;
  • The results of declining creditworthiness of sure public sector securities and the ensuing decline within the worth of presidency publicity that Aegon holds;
• Changes within the efficiency of Aegon’s funding portfolio and decline in scores of Aegon’s counterparties;
• Lowering of a number of of Aegon’s debt scores issued by acknowledged ranking organizations and the opposed influence such motion might have on Aegon’s capacity to elevate capital and on its liquidity and monetary situation;
• Lowering of a number of of insurer monetary energy scores of Aegon’s insurance subsidiaries and the opposed influence such motion might have on the written premium, coverage retention, profitability and liquidity of its insurance subsidiaries;
• The impact of the European Union’s Solvency II necessities and different rules in different jurisdictions affecting the capital Aegon is required to preserve;
• Changes affecting rate of interest ranges and persevering with low or quickly altering rate of interest ranges;
• Changes affecting forex change charges, specifically the EUR/USD and EUR/GBP change charges;
• Changes within the availability of, and prices related with, liquidity sources corresponding to financial institution and capital markets funding, in addition to situations within the credit score markets generally corresponding to adjustments in borrower and counterparty creditworthiness;
• Increasing ranges of competitors within the United States, the Netherlands, the United Kingdom and rising markets;
• Catastrophic occasions, both artifical or by nature, together with by the use of instance acts of God, acts of terrorism, acts of conflict and pandemics, may end in materials losses and considerably interrupt Aegon’s business;
• The frequency and severity of insured loss occasions;
• Changes affecting longevity, mortality, morbidity, persistence and different components which will influence the profitability of Aegon’s insurance merchandise;
• Aegon’s projected outcomes are extremely delicate to complicated mathematical fashions of monetary markets, mortality, longevity, and different dynamic techniques topic to shocks and unpredictable volatility. Should assumptions to these fashions later show incorrect, or ought to errors in these fashions escape the controls in place to detect them, future efficiency will range from projected outcomes;
• Reinsurers to whom Aegon has ceded vital underwriting dangers might fail to meet their obligations;
• Changes in buyer habits and public opinion generally associated to, amongst different issues, the kind of merchandise Aegon sells, together with authorized, regulatory or industrial necessity to meet altering buyer expectations;
• Customer responsiveness to each new merchandise and distribution channels;
• As Aegon’s operations assist complicated transactions and are extremely depending on the correct functioning of knowledge expertise, operational dangers corresponding to system disruptions or failures, safety or knowledge privateness breaches, cyberattacks, human error, failure to safeguard personally identifiable info, adjustments in operational practices or insufficient controls together with with respect to third events with which we do business might disrupt Aegon’s business, injury its popularity and adversely have an effect on its outcomes of operations, monetary situation and money flows;
• The influence of acquisitions and divestitures, restructurings, product withdrawals and different uncommon objects, together with Aegon’s capacity to combine acquisitions and to get hold of the anticipated outcomes and synergies from acquisitions;
• Aegon’s failure to obtain anticipated ranges of earnings or operational efficiencies, in addition to different administration initiatives associated to price financial savings, Cash Capital at Holding, gross monetary leverage and free money circulation;
• Changes within the insurance policies of central banks and/or governments;
• Litigation or regulatory motion that would require Aegon to pay vital damages or change the way in which Aegon does business;
• Competitive, authorized, regulatory, or tax adjustments that have an effect on profitability, the distribution price of or demand for Aegon’s merchandise;
• Consequences of an precise or potential break-up of the European financial union in entire or partly, or the exit of the United Kingdom from the European Union and potential penalties if different European Union nations go away the European Union;
• Changes in legal guidelines and rules, significantly these affecting Aegon’s operations’ capacity to rent and retain key personnel, taxation of Aegon corporations, the merchandise Aegon sells, and the attractiveness of sure merchandise to its customers;
• Regulatory adjustments relating to the pensions, funding, and insurance industries within the jurisdictions by which Aegon operates;
• Standard setting initiatives of supranational normal setting our bodies such because the Financial Stability Board and the International Association of Insurance Supervisors or adjustments to such requirements which will have an effect on regional (corresponding to EU), nationwide or US federal or state degree monetary regulation or the appliance thereof to Aegon, together with the designation of Aegon by the Financial Stability Board as a Global Systemically Important Insurer (G-SII); and
• Changes in accounting rules and insurance policies or a change by Aegon in making use of such rules and insurance policies, voluntarily or in any other case, which can have an effect on Aegon’s reported outcomes, shareholders’ fairness or regulatory capital adequacy ranges.

This doc incorporates info that qualifies, or might qualify, as inside info throughout the that means of Article 7(1) of the EU Market Abuse Regulation (596/2014). Further particulars of potential dangers and uncertainties affecting Aegon are described in its filings with the Netherlands Authority for the Financial Markets and the US Securities and Exchange Commission, together with the Annual Report. These forward-looking statements communicate solely as of the date of this doc. Except as required by any relevant legislation or regulation, Aegon expressly disclaims any obligation or endeavor to launch publicly any updates or revisions to any forward-looking statements contained herein to mirror any change in Aegon’s expectations with regard thereto or any change in occasions, situations or circumstances on which any such assertion relies.