Insurance M&A in APAC up 40%, leading global growth
Source: Middle East Insurance Review | Apr 2019
Asia-Pacific led the global growth in insurance M&A in 2018, driven by the many untapped opportunities in the region, according to Clyde & Co’s 2019 insurance growth report.
There were 382 deals in 2018, a 9% increase on 2017. With the exception of the Middle East & Africa, all major geographic regions recorded an increase in transaction activity. The Asia-Pacific insurance sector saw 59 completed deals, up 40% from 42 in 2017.
“The growth of M&A activity in APAC has far outstripped other regions around the world over last year,” said Hong Kong-based Clyde & Co corporate insurance partner Joyce Chan in a statement. “With huge untapped potential due to relatively low insurance penetration in the region and a range of advances in innovative technology changing the way insurance is written and sold, you would expect the interest in the region to remain high.”
While the Americas remained the most active region for M&A with 189 deals in 2018, it saw a slight drop off in the second half of the year with 92 transactions, down from 97 in the first six months. Europe was steady with 122 completed deals in 2018, from 118 in the previous year, said the report.
Global head of Clyde & Co’s Corporate Insurance Group Andrew Holderness attributed the increase in M&A transactions to companies’ growth strategy of reaching new customers and markets and reducing costs through synergies. He pointed out that factors such as Brexit, trade wars and protectionism are generating uncertainty in deal-making. “The slowdown in the Americas in the second half of last year is indicative of heightened investor caution and we predict 2019 will be a year of two halves – a slowdown in M&A in some markets in the first six months, while the second half should see a return to form,” he said. M