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Global insurance M&A in 1H2017 hits two-year low

Source: Middle East Insurance Review | Sep 2017

The volume of completed M&A in the global insurance industry continued to fall in the first half of 2017 to 170 deals, compared to the 186 reported over the same period last year, as insurance businesses continue to pursue a range of routes to growth, according to Clyde & Co’s mid-year M&A update. 
 
   Diving into the regions, M&A activity was up in the Americas, Middle East & Africa and down in Europe and Asia. 
 
   The Middle East and Africa saw a slight uptick in M&A, albeit from a low base, with eight deals compared to just two in the prior period. Activity was also up in the Americas, with 86 transactions so far this year, compared to 81 in the preceding six months.
 
   Activity in Europe fell 28% in the last six months, in part due to the distraction of Brexit, while completed M&A deals in Asia Pacific fell to 22 from 36 in the second half of 2016, partly due to temporary monetary controls in place in China.
 
   “Uncertainty is the enemy of deal-making. M&A has risen in the Americas now that the uncertainty that plagued the market in the run-up to the US presidential election has eased somewhat.
“However, in Europe, uncertainty persists with Brexit acting as a significant brake on M&A activity. Transactions have been overtaken on the corporate agenda by Brexit preparations as companies realise that there is no time to lose. 
 
   “Elsewhere in Europe, political and economic uncertainty in markets as far apart as Greece, Italy and Russia continue to weigh heavy on investor sentiment,” said Mr Andrew Holderness, Global Head of the Corporate Insurance Group at Clyde & Co. 
 
   “Growth remains a shareholder imperative in an increasingly difficult trading environment, and insurers are investigating every avenue – both organic and inorganic – in an attempt to deliver this, wherever they are in the world,” he added. M 
 
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