INSURANCE giant Aviva is to quit the US life and pensions market after announcing a £1.1billion deal to offload its American arm.

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The Norwich-based group is selling Aviva USA to Athene Holding, a major player in America’s pension annuity sector.

The move comes six years after Aviva entered the US with the acquisition of AmerUs for £1.6bn, although the group stressed it will retain its asset management presence in America.

Today’s sale comes as part of a restructuring being led by chairman John McFarlane following the departure of chief executive Andrew Moss in May amid discontent over a poor share price performance.

New chief executive Mark Wilson, the former boss of Asian insurer AIA, is due to take on the reins on January 1.

As part of the plans announced in July, Mr McFarlane is working towards the sale or scaling back of 16 underperforming businesses.

It is also cutting up to 800 jobs across the business under plans to slash costs by £400million.

Aviva has already offloaded its Sri Lankan business, sold down its stake in Dutch insurer Delta Lloyd and earlier this week announced it was netting almost £500million after agreeing a settlement to walk away from its Spanish joint venture with Bankia.

It said today that the sale of its US business will “considerably” boost its balance sheet strength.

Mr McFarlane added: “The disposal of the US business, combined with the recent settlement with Bankia, represents a successful end to the year and sets us up well for 2013.”

Aviva USA is a provider of indexed life insurance and indexed annuities with more than 930,000 customers.

Headquartered in Iowa, the business employs 1,800 people and has offices in Topeka, Kansas and Melville, New York.

Athene will become America’s second largest fixed and equity indexed annuities player following the deal.

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