U.S. Insurance Mergers & Acquisitions Activity Drops
March 22, 2013 by PR Newswire Association LLC
HARTFORD, Conn., March 20, 2013 /PRNewswire/ –In 2012, U.S. insurance mergers and acquisitions activity fell sharply, despite conventional drivers that seemed to suggest what should have been an active year for insurance M&A, according to Conning’s annual study, “Global Insurance Mergers & Acquisitions.”
“Mergers and acquisition activity in the U.S. insurance market dropped in 2012, with transactions off 19% and aggregate deal volume off 21%,” saidJerry Theodorou, analyst at Conning. “In 2012, high levels of industry capital and limited opportunity for organic growth suggested that it should have been a very active year. Yet transaction activity declined significantly from 2011.”
The Conning study, “Global Insurance Mergers & Acquisitions in 2012: Fragmented Patterns in an Uncertain Environment” tracks and analyzes both U.S. and non-U.S. insurance industry M&A activity across property-casualty, life-annuity, health insurance and distribution and services sectors.
“Insurance M&A activity in the U.S. started strong in the first quarter of 2012. However, the following two quarters were very slow, as concerns about U.S. economy and economic conditions elsewhere had chilling effects,” said Stephan Christiansen, director of research at Conning. “That turned around significantly in the fourth quarter, where we saw a substantial uptick in activity in most sectors, which may well set the stage for a strong 2013. Outside the U.S., the pace of insurance M&A declined less, buoyed by financial institutions selling their insurance operations to raise assets to repay government loans or meet regulatory requirements.”
