SHAREHOLDERS APPROVE MERGER BETWEEN CGU AND NORWICH UNION

Shareholders of the UK’s CGU and Norwich Union have backed the companies’ plans to merge, forming the country’s largest insurer and one of the top five insurance groups in Europe. The deal, unveiled in late February, will lead to the creation of CGNU, which will have worldwide premium income and retail investment sales of £26bn. The combined operation will also operate a major asset management business, with more than £200bn of funds under management. The merger is set to achieve annual cost savings of £250m over the next 18 months, with 5,000 jobs to be cut. Norwich Union chief executive Richard Harvey, who will become CGNU’s deputy chief executive, noted that “if we do not consolidate here in the UK we will find ourselves unable to compete with those that have consolidated across the rest of Europe”.