KPMG Insurance M&A Monthly


December 2011	SEARCH ANALYSIS ARCHIVE FEEDBACK

KPMG ANALYSIS

What Factors Are Correlated With Deal Success?

Dealmakers should continue to focus on due diligence and also be aware of how different deal characteristics may be correlated with deal success through various business cycles.

IFRS Insurance Newsletter

This IFRS Insurance Newsletter highlights key developments relating to the IASB and FASB’s joint insurance contracts project.

Feature of the Month

Report Says M&A Deal Flow Will Pick Up, Lists Potential Candidates

The insurance industry is likely to see more robust mergers-and-acquisitions activities in 2012, according to a New York investment and research firm.

Other News

Transatlantic, Alleghany Shareholders to Vote on Merger in February

Transatlantic Holdings Inc. and Alleghany Corp. said their respective shareholders will vote February 6 on their proposed $3.4 billion merger.

MetLife to Sell Most of Its Bank Depository Business to GE Capital Financial

INSURANCE NEWSNETUnder the agreement signed by GE Capital and MetLife Bank N.A., GE Capital will buy about $7.5 billion of the bank's deposits, including certificates of deposit and money market accounts.

ING Shelves Trade Sale of Belgian Insurer

REUTERSDutch financial services group ING Groep has scrapped plans for a separate trade sale of its Belgian insurance business, worth 500 to 750 million euros.

Old Mutual to Sell Finland Life Insurance Business

INSURANCE NEWSNETOld Mutual plc said it will sell its Skandia Life Finland business to Op-Pohjola osk, a Finnish financial services group, as Old Mutual continues to streamline its international business structure.

New China Life Raises $1.9 Billion in Dual IPO

REUTERSNew China Life Insurance Co Ltd, the country's third-biggest life insurer, raised about $1.9 billion in a dual IPO in Hong Kong and Shanghai, pricing the deal at the bottom of expectations.

Haverford Ends Talks to Buy Omega Stake

REUTERSBermudin reinsurer Haverford said it had ended talks to buy a stake in London-listed Omega Insurance after the two sides failed to agree on a price.

INDUSTRY M&A ACTIVITY

WT Holdings agreed to acquire an 85 percent interest in Fidelity National Insurance, a Florida-based provider of insurance underwriting services, from Fidelity National Financial, for an estimated $119 million. (12/27)

Tokio Marine & Nichido Fire Insurance agreed to acquire Delphi Financial Group, a Pennsylvania- based insurance company, for $2.6 billion. (12/21)

York Risk Services Organization acquired Frank Gates Service, an Ohio-based provider of claims and risk management services, from KRG Capital Partners. Terms were not disclosed. (12/15)

Pacific Merger, a wholly-owned unit of Brown & Brown, agreed to merge with Arrowhead General Insurance Agency, a California-based insurance agency, for $400 million. The consideration consists of $395 million and up to $5 million in profit-related payments in the next three years. (12/15)

Great American Insurance, a wholly-owned unit of American Financial Group, agreed to acquire Employers Comp Associates and Freeman Administrative Solutions, a Texas-based insurance agency and claims processing servicer. Terms were not disclosed. (12/6)

Source: Company press releases.

MERGER STATISTICS

Overall M&A deal volume was relatively flat as compared to the third quarter of 2011 and slightly increased as compared to the fourth quarter of 2010. However, the large increase in total deal value from third quarter 2011 and fourth quarter 2010 is a result of the $3.4 billion merger between Transatlantic and Alleghany and the $2.6 billion acquisition of Delphi Financial Group by Tokio Marine & Nichido Fire Insurance.

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KPMG’S TRANSACTION SERVICES PRACTICE

KPMG’s Transaction Services and M&A Tax practices comprise over 600 partners and professionals in the United States, solely devoted to providing acquisition and divestiture support and advisory services to strategic and financial investors.

For more information about KPMG's transaction services capabilities in the insurance sector please contact: Michael Ryan, Partner at 214 840 2262 (maryan@kpmg.com) or Ram Menon, Managing Director at 212 954 3448 (rammenon@kpmg.com).

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