Volume up, value down in insurance M&A worldwide

Mergers and acquisitions in the U.S. insurance industry lost value last year, while non-U.S. transactions plummeted, according to data from Conning Research and Consulting.
APR 20, 2009
Mergers and acquisitions in the U.S. insurance industry lost value last year, while non-U.S. transactions plummeted, according to data from Conning Research and Consulting. Last year ended with more acquisitions for the overall industry around the world, totaling 766 transactions, compared with 750 transactions in 2007. However, deal values took a major slide, worth a total of just $55.5 billion, compared with $138 billion in 2007. Stateside, the reported value of mergers and acquisitions in the insurance industry totaled $31.4 billion, down from $50.4 billion in 2007. Most of that activity came from mergers in distribution and services. Mergers in U.S. life and annuity carriers totaled 14 transactions, worth just $382 million, compared with 19 deals in 2007 worth a total of $5.85 billion. For transactions outside the United States, mergers rose to a total of 296 deals, up from 225 in 2007. But the value of the transactions fell by more than two-thirds, falling to $24.1 billion, from $87.9 billion in 2007. This year, life insurance mergers continue to lag behind the rest of the insurance industry, according to Conning Research, a part of Conning & Co., a Hartford, Conn.-based subsidiary of Swiss Reinsurance Co. in Zurich, Switzerland. In the first two months of 2009, about 86 transactions were announced. Of these, 38 of the transactions are considered to be distribution mergers. Just 12 of the transactions in 2009 so far have been labeled as deals involving life insurers. The largest deal announced thus far in 2009 was the $916 million combination of IPC Holdings Ltd. of Pembroke, Bermuda, and Max Capital Group Ltd., a Hamilton, Bermuda-based reinsurer.

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