Global insurance M&A hits 10 year high

M&A activity in the global insurance industry reached the highest growth rate for 10 years in the first half of 2022, according to Clyde & Co’s Insurance Growth Report mid-year update.

Released today, the figures show 242 completed deals worldwide, up from 221 in the second half of 2021 and 197 at the same point last year.

Significant deal activity in the US pushed the number of transactions there to 132, the highest number of transactions in 10 years, up from 108 in H2 2021.

In Europe, strong growth in the second half of 2021 dropped off slightly to 67 from 74 in the previous six-month period.

The UK was the most active country ahead of France, the Netherlands and Spain.

In contrast, after a dip in 2021, deal activity across the Middle East and Africa rose back up to 16 deals compared to 12 in the second half of last year. The majority of acquirors in this half of the year came from Africa – four from the Ivory Coast, three from South Africa and two from Kenya.

The number of deals in Asia-Pacific remained relatively steady with 27 compared to 24 deals in the second half of 2021. Japan was once again the lead acquiror ahead of Australia.

Eva-Maria Barbosa, partner at Clyde & Co in Munich, said: “In the face of stark economic pressures – inflation, rising energy costs, and looming recession – insurers remain focused on growth opportunities. Several factors are driving deals. Rising interest rates promise better investment returns for long duration businesses, while helping insurers to rebalance portfolios.

"Private equity firms and asset managers are still keen to explore either entry into the insurance market or expansion of existing footprints. And flagging insurtech valuations mean acquisitions are increasingly attractive to both PE investors and traditional carriers seeking to increase technological capabilities.”

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