LONDON (ShareCast) - Aegon has agreed to sell its Canadian life business to Wilton Re for €423m (C$600m).
"We continually review the performance of our businesses to ensure that they support our ambition to become a leader in our chosen markets," said Alex Wynaendts, chief executive of Aegon.

"We have concluded that our Canadian life insurance business does not support that goal," he said, adding that the disposal will lead to an improvement in Aegon's return on equity of 40 basis points.

"At the same time, we believe this is a good outcome for our customers and employees, as the company will continue to offer competitive choices for the middle market in Canada," he said.

The Canadian business made net underlying earnings of C$26m over the trailing four quarters ending June 2014, while its
shareholders' equity excluding revaluation reserves on an IFRS basis amounted to C$1.8bn.

As a result, the sale price represents a multiple of 23 times net underlying earnings.

The company said the transaction was expected to result in a book loss of approximately C$1.2bn.

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