(Reuters) - Aegon has completed the sale of its Hungarian arm to Vienna Insurance Group (VIG) for 620 million euros ($682 million), the Dutch insurer said on Wednesday.
Aegon had announced the 830 million euro sale of its Central and Eastern European insurance, pension, and asset management businesses to VIG in 2020, but the Hungarian government initially blocked the deal.
Late last year, however, the country's finance ministry said it had signed a memorandum of understanding with VIG that could enable it to take a 45% stake in the two companies' local unit, and the European Commission later ordered Hungary to withdraw its veto.
Right-wing nationalist Prime Minister Viktor Orban has repeatedly said Hungarian companies or the state must hold majority stakes in sectors including finance, energy, media and trade.
Aegon, which plans complete the sales of its Polish, Romanian and Turkish businesses this year, said in a statement the sale was an important step towards narrowing its strategic focus and bolstering its balance sheet.
The group said the cash boost would help it to lower its debt, and announced a 375 million euro repayment tender offer as well as a 300 million euro share buyback from April to December.
Following the debt tender offer, Aegon expects to have reduced its gross financial leverage to 5-5.5 billion euros.
($1 = 0.9089 euros)