HDI Global Specialty will seek M&A in quest for €5 bn premium target

HDI Global Specialty could leverage M&A to push itself towards a €5 billion premium target by 2025-26, the CEO of HDI Global Specialty Ralph Beutter indicated.

“The plan by 2025-2026 is to have something closer to €5 billion,” Beutter said of premium outlook for a firm on track to hit the €3.2 billion mark this year.

Organic growth can get the unit from 2022’s estimated €3.2 billion to a target €3.6 billion in 2025. M&A should deliver the gap to a 10% compound annual growth rate in premium, an accompanying slide indicated.

“Organically we will probably not achieve that on our own, so we are open, of course, to look into M&A,” Beutter said. “With non-organic growth we have extreme confidence to hit the €5 billion premium number in the future to 2025-2026.”

Beutter hopes to better leverage global reach, including to fill in some regions under-represented to date on the HDI Global books. That could mean South American, Soth East Asia “but also the US.”

The US market merited the sole mention on the presentation slide, where HDI Specialty hopes to “expand the US footprint, e.g., via focused M&A.”

Growth to date for the unit has had an opportunistic approach as prices and “low-hanging fruit” delivered 30% CAGR 2019-2022, Beutter acknowledged.

“Now we want to have a more systematic approach,” the unit CEO said. “But we will not lose the underwriting discipline; I think it is key that we stay disciplined.”

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