Growth in M&A continues

Growth in M&A continues

Mergers and acquisitions (M&A) in the international insurance industry have risen for the second consecutive six months, according to Clyde & Co’s Insurance Growth Report mid-year update.

Mergers and acquisitions (M&A) in the international insurance industry have risen for the second consecutive six months, according to Clyde & Co’s Insurance Growth Report mid-year update.

In the first half of 2018, 186 completed deals took place, up from 180 in the last half of 2017. This steady increase comes after a low point in the first half of 2017, after two years of steady decline.

Most regions saw an increase in M&A in the first half of 2018, with the Americas leading the way with 97 deals in total, compared to 90 at the end of 2017.  Clyde & Co suggests that this was down to the strengthening economic outlook in the US, plus the shifting reinsurance fundamentals in Bermuda. Asia saw a total of 25 M&A, up from 20, with Japan acquirors being the driving force behind a number of the deals, while the Middle East and Africa grew from three deals to four deals completed. Europe was the only region to suffer a drop in deals, slipping from 65 in the last half of 2017, to 59 in 2018.

“After a sustained period of sliding M&A volumes that bottomed out in the first half of 2017, the first green shoots of recovery that we saw at the turn of the year are now taking root,” Andrew Holderness, Clyde & Co, Global Head of Corporate Insurance, said. “The characteristics of the operating environment haven’t changed – the market remains uber-competitive and generating growth a perennial challenge – so M&A can provide potential synergies on reducing the cost base, build scale and access new customers.”