INSURANCE giant Aviva is to amalgamate rival firm Friends Life into is York-headquartered operation in a £5.2 billion deal which will result in number of job losses.

Aviva bosses said it is too soon to say how many jobs will be cut, but indicated there will be a "headcount reduction" due to an inevitable duplication of roles as the two operations merge.

Aviva revealed just over a week ago that it was in advanced takeover talks with Friends Life, with the business due to be merged within Aviva's life division, which is headquartered in York and employs 2,000 people in two city centre offices.

While the enlarged business will see Aviva's customer base from from 11 million to 16 million, it is also set to generate cost savings of £225 million by the end of 2017.

Aviva chief executive Mark Wilson said: "It is one of those rare transactions where the two organisations fit with surgical precision, building on each other's strengths and addressing the challenges.

"In combining these two operations there may be some duplication in roles and a head count reduction.

"However the significant part of the savings we are making aren't coming from job reductions.

"If there is an impact on our people we will look to minimise the job losses. It's way too early to give any numbers, but the first thing we are going to do is talk to our people.

"I don't know when we will get to a stage of actual job numbers. We just need to go through the process of the integration and go from there.

"We are not going to speculate on any locations around the country. We have got some outstanding people in York, as we do around the country. At the right time we will look at all that sort of stuff."

With the deal is not set to be complete until a shareholders meeting at the end of March, at the earliest, with any job loss figures to be announced after that.

Mr Wilson said he had been in talks with heads of departments within Aviva yesterday, and that he has received hundreds of emails from staff already.

He said: "A lot of them talk about this as an exciting time as they realise it's their hard work that has allowed us to get to this position".

Aviva employs around 28,000 staff worldwide including 12,000 in the UK, while Friends Life employs 3,500 staff, mainly in offices in London, Manchester, Bristol and Salisbury.

Friends Life was created in 2011 following the amalgamation of Friends Provident, the majority of Axa UK Life and Bupa Health Assurance.

Mr Wilson said the deal was the "catalyst" to the next stage of Aviva's operation, with the business looking to move over to a "digital first" approach, alongside plans to tackle new markets geographically and operationally.