Insurers active in both buying and selling foreign firms

MS&AD Insurance Holdings is to invest up to £800m ($1bn) in ReAssure Jersey One Limited, a UK unit of Swiss Re, in a two-stage deal which will see it first acquiring 5% of the target’s outstanding shares for £175mn by 31 March next year, and then subscribing over three years for new shares to bring its total holding up to 15%.

The Japanese company is the country’s largest wholly private sector insurer and has both life and nonlife units. The deal has been characterised by the Nikkei newspaper as representing “MS&AD’s first big investment in Europe, and the company looks to use it as a steppingstone for business expansion there and to diversify its revenue sources, which center on Japan and the rest of Asia”.

Just a month before, Sompo Holdings, one of Japan’s Big Three property and casualty insurers, agreed to sell Sompo Canopius, which it acquired in 2013 for US$970mn million, to a private equity consortium led by Centerbridge Partners for US$952mn.

As they seek to escape the constraints of a shrinking population, insurance  companies have been very active in seeking overseas opportunities and Sompo gave its reason for disposing of Canopius as a lack of fit with Endurance Specialty Holding of the US which it acquired earlier this year.

© 2017 Japan Pensions Industry Database/Jo McBride. Reporting on, and analysis of, the secretive business of Japanese institutional investment takes big commitments of money and time. This blog is one of the products of such commitment. It may nonetheless be reproduced or used as a source without charge so long as (but only so long as) the use is credited to and a link provided to the original text on that site.

This blog would not exist without the help and humour of Diane Stormont, 1959-2012

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