Scotland business

Aviva move to buy Perth premises welcomed

Aviva building, Perth
Image caption Aviva's lease for its site in Perth was due to expire at the end of 2014

Insurer Aviva has ended speculation about its future presence in Perth by buying its existing premises in the city.

Aviva's lease for its Pitheavlis site was due to expire before the end of next year, prompting local concern that the company might relocate to Glasgow.

The firm has now confirmed it is buying the building for an undisclosed sum after reviewing its property strategy.

The Scottish government welcomed the decision.

Aviva said buying the Pitheavlis building to serve as a centre of excellence for Aviva's UK general insurance business was "the best option from an economic, employee and customer care point of view".

There are currently 1,300 staff at the site, although some jobs there could be at risk.

In April, Aviva revealed plans to cut 6% of the company's workforce worldwide over the next few months.

The cost-cutting move will see about 2,000 people in the UK, Europe and Asia lose their jobs.

Ian Ferguson, chief underwriting officer for Aviva's intermediary and partnerships business, said the site purchase confirmed Aviva's ongoing commitment to Perth.

"This purchase meets Aviva's immediate financial needs whilst providing long-term benefits," he said.

"This is a sensible, sustainable purchase that supports our financial targets.

"The quality of our staff in Perth was another hugely compelling factor in choosing to remain here."

'Vote of confidence'

Finance Secretary John Swinney welcomed the news.

He said: "There has been a great deal of uncertainty surrounding the renegotiation of the lease, but the company's decision to purchase the site is a massive vote of confidence in the workforce in the city of Perth.

"I applaud Aviva for recognising the enormous strength and capability of the workforce in Perth that has resulted in such a long-term commitment to this facility.

"The Scottish government appreciates the open and positive working relationship we have with Aviva and look forward to continuing to develop that relationship in the years to come."

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