In the third quarter, Europe, Middle East and Africa (EMEA) continues to be the second most active region, with insurance brokerage the most active segment (measured by number of deals), particularly in the London Market.
The UK continued to be the most active market in Europe with some large deals, underpinned by some interesting broader trends, including expansion of Japanese insurers into Europe (similar to recent activity in the US, with potential for significant future activity), consolidation driven by the changing regulatory environment and the continued development of the closed life market (and possible expansion out of the UK and into continental Europe).
On the flip side, Zurich Insurance Group terminated its takeover talks with British insurer RSA following poor performance in its general insurance business.
US companies have also shown interest in expanding their business in Europe, including:
In addition The Carlyle Group, the US-based private equity firm has agreed to acquire Innovation Group, which is a leading British insurance claim technology company for around GBP 500 million. Again, an interesting transaction and one that signals an increasing trend of PE acquiring innovative service companies supporting the insurance industry.
The ongoing trend of exiting non-core operations also continues, illustrated by AXA's announcement that it is in talks with Ageas to sell its Portuguese operations in a deal worth EUR 197.5 million (US$214.9 million).
The life run-off market in Germany has also shown further movement. The latest transaction involved Baloise selling a life insurance portfolio of CHF 1.9 billion from its German subsidiary to Frankfurter Leben, a newly established run-off platform. This deal follows the closing of the acquisition by Athene Holdings of Delta Lloyd's German subsidiaries, with a €4.9 billion portfolio, earlier in October. In the last 18 months this part of the market has really developed with a number of closed book consolidation platforms created, backed by Cinven, Apollo and Fosun. We expect this trend to continue and expand into other continental European markets as the focus on proactive in-force management continues.
For more information on how KPMG’s global network of member firms can help you with your M&A activities, please contact firstname.lastname@example.org.
Note: Content for this newsletter has been compiled from a variety of publicly available sources.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.