Japan: Insurers on massive overseas buying spree
Source: Asia Insurance Review | Oct 2015
MS&AD Insurance Group Holdings has agreed to acquire Amlin, a Lloyd’s of London underwriter, for GBP3.47 billion (US$5.3 billion), in the latest overseas acquisition by Japanese insurers as they face slowing growth at home where the population is ageing.
The all-cash deal is expected to be completed by the end of March 2016, the Japanese insurer said.
This follows Meiji Yasuda Life Insurance’s announcement in July that it would spend $5 billion on Oregon-based StanCorp Financial Group. The deal allows Meji Yasuda Life access to the lucrative employee benefits arm of StanCorp which is the eighth largest provider of group life insurance in the US.
In June, Tokio Marine, Japan’s largest insurer by market value, agreed to spend $7.5 billion to acquire Houston-based specialty insurer HCC Insurance Holding. The amount would make the transaction the largest M&A deal by a Japanese company this year.
In other large purchases by Japanese insurers, Dai-ichi Life Insurance completed in February the purchase of Alabama-headquartered Protective Life Corp for $5.7 billion after reaching an agreement on the deal in June last year.
Apart from seeking yields in overseas markets, the Japanese insurers are diversifying risks through these overseas deals given that Japan is prone to natural disasters like earthquakes and typhoons.