Heightened M&A Activity in the Insurance Sector

Just days into the fourth quarter, the insurance sector has experienced heightened M&A activity, supporting Twelve Capital’s recently launched M&A insurance equity focused portfolios. This week has seen three confirmed approaches, two involving listed (re)insurers, and one private name. The listed space has seen approaches by Sompo Japan Nipponkoa Insurance for Endurance Specialty Holdings, and NN Group for Delta Lloyd. Amongst private (re)insurers two Shenzen Government-owned investment companies have agreed to buy ACR Capital Holdings Pte Ltd, the owner of Singapore’s biggest reinsurance firm.

Aside from the three confirmed approaches, there has also been multiple media reports around additional M&A activity, including amongst listed names that Markel had been in discussions with Allied World regarding a takeover, and within the private space that Apollo Global Management is expected to acquire 50% of Lloyd’s (re)insurer Ariel.

William Hardcastle, Director, and Strategy Head of Twelve Capital’s liquid equity strategy added: “The share price benefit is not restricted to these stocks as investors look to own the next company that may be acquired at a premium to current share price. M&A activity is picking up, and we see no reason why this global trend won’t continue into 2017. The multitude of factors driving M&A remain, including subdued organic growth opportunities, increased importance of scale, cheap financing and currency dislocations.”

Thursday, 06 October 2016

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Twelve Capital is an independent investment manager specialising in insurance investments for institutional clients as well as a leading provider of capital to the insurance and reinsurance industry.

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