M&A: The perils of a shotgun wedding


M&A: The perils of a shotgun wedding

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The risk transfer landscape is being transformed by consolidation and the idea that bigger and more diversity is better—particularly if access to alternative capital is involved. But, just like in real life, some recent marriages—especially those rushed into for the wrong reasons—may well end in divorce. Intelligent Insurer reports.

They say opposites attract, and that a good marriage is greater than the sum of its parts. That is exactly what a number of insurers are gambling on in relation to commitments they have made of late in the form of an acquisition—they hope a complementary skillset will set them apart from the pack.

However, divorce in many countries now sits at record levels, and bringing together two large corporates can actually be infinitely harder than a marriage of two people. The break-ups are also more complex, if not more painful.

How much of a gamble are some of these companies making? And to what extent might they have felt pressured to walk down the aisle—not by parents and friends but by the corporate equivalent: investors.

M&A, Risk transfer, Munich Re, Markel, AXA, XL Group Nephila, AIG, Validus Holdings, ILS, Acquisitions, Insurance, Reinsurance, Global

Intelligent Insurer