Insurance

Aon repeats gaffe with $30 bln Willis deal

9 Mar 2020

Investor skepticism quickly torpedoed the insurance broker’s idea, exactly a year ago, of buying rival Willis Towers Watson. Now the two have signed a deal – and it still looks unrewarding for Aon’s owners. Announcing it amidst market virus panic adds insult to injury.

Agnellis best the French in $9 bln reinsurer sale

4 Mar 2020

Covea is paying a 38% premium over book value for PartnerRe. That’s more than Exor paid four years ago and the same price mooted three-plus weeks ago. Since then, rival insurers have tumbled in value. Covea’s mutual structure looks to give it incentives to misallocate capital.

Dan Loeb kicks on open door with Pru breakup plan

24 Feb 2020

The outspoken investor has called for $47 bln UK insurer Prudential to carve itself up. There’s plenty of value to be unlocked by separating the fast-growing Asian business from the sleepier U.S. retirement unit. An open-minded board means Loeb won’t have to shout too loudly.

Aegon’s new CEO has big credibility gap to fix

13 Feb 2020

The Dutch insurer’s shares fell 8% on Thursday after it reported lower profits and weaker capital than expected. Low interest rates are hurting its core U.S. business, and it has a nasty habit of goofing up its modelling. Incoming boss Lard Friese faces a tricky turnaround.

Insurance tie-up leaves Scor out in the cold

11 Feb 2020

The $7.5 bln French insurer fought off an unwanted offer from Covea. Now its erstwhile suitor may team up with rival PartnerRe. That leaves CEO Denis Kessler short of options. If Covea sells its 8% stake in Scor, shares which have trailed the industry will face further pressure.

Insurance sale gives Agnellis a cash conundrum

10 Feb 2020

Exor, run by Fiat scion John Elkann, is in talks to sell PartnerRe to France’s Covea for $9 bln. Factor in a big dividend from the Peugeot merger and the Italian family’s investment vehicle will be liquid but less diversified. Deploying the proceeds wisely is a new challenge.

Chinese panic is more contagious than coronavirus

7 Feb 2020

Shoppers are aggressively hoarding rice, toilet paper and vegetables, and sealing off their gated apartment complexes. That suggests they think things will get a lot worse before they get better. Such anxiety may become self-fulfilling; economic malaise can outlive an epidemic.

India’s mega-IPO sounds like Aramco mess in making

3 Feb 2020

The mooted listing of state giant Life Insurance Corp, maybe worth some $130 bln, is the strongest sign yet of a government ready to shake things up. As with the Saudi oil debut, though, it will be a painstaking process that bends rules only to achieve a half-baked outcome.

Wuhan virus will shape China’s smart city vision

24 Jan 2020

The metropolis of 11 mln is under quarantine. Big investments in healthcare, AI and even surveillance led by the $50 bln Hikvision and other giants could help curb future contagion risk. That might compensate for less tractable problems: human error and institutional weakness.

China’s health grey zone is hazardous for fintech

16 Dec 2019

Soaring medical costs in the People's Republic have prompted Jack Ma's $150 bln Ant Financial and others to offer insurance-like solutions. A scandal involving a Tencent-backed upstart, though, is a reminder the sector is largely unregulated. That's unlikely to remain the case.

China’s $4 bln bank IPO disappoints by design

10 Dec 2019

Postal Savings Bank shares opened flat on their Shanghai debut. Beijing’s rule of thumb that the price at least match book value is partly to blame. State funds may have gotten this deal over the line, but the poor market reception will make it harder for peers to recapitalise.

Swiss Re swallows pride with $4.2 bln UK castoff

6 Dec 2019

The Zurich-based insurer will sell its British business to rival Phoenix at a valuation similar to its cancelled public listing. CEO Christian Mumenthaler had few other options. Given the threat of Brexit, foregoing a takeover premium is a price worth paying for a cleaner sale.

Ping An’s fintech halo is losing its glow

4 Dec 2019

China's top insurer may list its OneConnect banking software business at a $5 bln valuation. That would be a third lower than its last funding round, which included SoftBank’s Vision Fund. Other cutting-edge ventures have hit bumps, too. Ping An is falling short of the hype.

AIA buys itself a little extra China cover

25 Nov 2019

The $120 bln insurer hired Lee Yuan Siong from Ping An to be CEO. Weathering strife in Hong Kong, its biggest market, is the most immediate challenge. His tech savvy and mainland political ties, nurtured during his time at the Chinese titan, will be valuable both now and later.

Aviva’s drift to mediocrity may tempt an activist

20 Nov 2019

The UK insurer pledged to simplify its business. Yet new CEO Maurice Tulloch’s strategy review disappointed hopes for asset sales, and mostly reaffirmed older aims. The $21 bln group’s sprawling structure, and discount to peers make it a juicy target for an uppity investor.

Prudential Brexit split only partly reveals value

30 Sep 2019

The 38 bln pound insurer is spinning off its UK asset manager and annuities arm next month. M&G could be worth close to 7.8 bln pounds, according to Breakingviews calculations. To justify the hassle, though, Prudential investors will award its Asian operations a higher rating.

Green finance can fix its Groucho Marx problem

23 Sep 2019

The comic once quipped he wouldn’t join a club that would have him as a member. With lots of signatories but muted impact, the U.N.-backed PRI has long been the butt of similar jokes. New pledges need tough bouncers and a better VIP area. French bank Natixis may have a solution.

AIA has a good option against Hong Kong turmoil

17 Sep 2019

The $120 bln insurer is vulnerable to protests rocking the city with an estimated one third of new business dependent on visitors from the mainland, many hoping to move money offshore. AIA’s policies sold in China are no substitute, but expansion there will ease any future pain.

Dutch insurer revisits ghosts of low yields past

15 Aug 2019

Despite hiking its dividend, Aegon’s shares dived after a sharp drop in solvency. That revives bad memories of the insurer’s volatile capital a few years back. Incoming CEO Lard Friese’s first job is to show investors he’s better at managing the group as low rates bite once more.

Prudential shrugs off Hong Kong struggles

14 Aug 2019

Strong Asian growth propelled the London-listed insurer to a 14% year-on-year increase in first half operating profit. Management is focusing on a demerger of the UK business to boost Pru’s lowly valuation, but unrest in its largest Asian market may cast a shadow on sentiment.