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Japan: Local units of foreign players are now buyout targets

Source: Asia Insurance Review | Nov 2017

Japan M&A

Midsize foreign-affiliated life insurers in Japan are becoming acquisition targets.
 
   Factors leading to the situation include diminishing growth prospects in Japan’s market as the country’s population shrinks, and regulations overseas that cause foreign insurers to scale down their overseas operations, reported The Nikkei.
 
   Among the M&A deals involving foreign-affiliated insurers, Nippon Life Insurance is in the final stages of acquiring MassMutual Life Insurance, the Japanese unit of US insurer MassMutual Financial Group. Earlier, FWD Group of Hong Kong acquired AIG Fuji Life Insurance.
 
   The buyouts are a reversal of an earlier trend in which foreign life insurers had acquired Japanese companies that ran into financial trouble following the bursting of the bubble economy in the late 1990s and needed foreign capital to stay afloat. For instance, MassMutual’s Japanese business was derived from Heiwa Life Insurance. US-affiliated Prudential Life Insurance absorbed Aoba Life Insurance that was founded to assume contracts from failed Nissan Life Insurance; and AXA Group of France made Nippon Dantai Life Insurance a subsidiary. A 
 
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