(RTTNews) - Insurance services provider Aviva plc (AV, AV.L) Tuesday announced that the offer price for initial public offering, or IPO, of Dutch insurance unit Delta Lloyd N.V. is EUR 16.00 per share, resulting in a market capitalisation of EUR 2.65 billion for Delta Lloyd.

London, UK-based Aviva stated that the IPO will be raising total gross cash proceeds of nearly EUR 1.12 billion based on a total offering of 63.5 million shares, or GBP 1.03 billion based on an exchange rate of GBP 0.92/EUR 1, for Aviva, which will be retained by Aviva.

Aviva's group chief executive Andrew Moss said, "The proceeds from this transaction will give Aviva greater flexibility, including exploring further growth opportunities." The IPO is also expected to enhance the value and liquidity of Aviva's retained stake in Delta Lloyd.

Based on a total offering of 63.5 million shares, Aviva will retain about 57.2% of ordinary share capital and 53.0% of voting rights in Delta Lloyd. Being the majority stakeholder, Aviva will continue to consolidate Delta Lloyd in its financial statements.

As a part of the IPO, Aviva said it has signed deal with Delta Lloyd upon a new corporate governance framework consistent with Dutch market practice. Aviva will be retaining the right to nominate two supervisory board members of Delta Lloyd, and will be required to approve any transactions that would result in dilution of Aviva's voting rights below 50%.

In Monday's regular trading session, AV closed trading at $12.76 per share on the New York Stock Exchange.

In Tuesday's regular trading session, AV.L is currently trading on the London Stock Exchange at 380.50 pence per share down 8.60 pence or 2.21% on a volume of 758,551 shares. In the past 52-week period, the shares have been trading in a range of 160.10 pence to 474.00 pence.

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