Insurance

Ray-Ban heirs inherit wasteful Mediobanca feud

9 Aug 2022

Eyewear tycoon Leonardo Del Vecchio, who died in June, bought nearly 20% of the Italian bank as part of a fight with CEO Alberto Nagel. Making a return on the $1.5 bln stake will test his successors. Backing Nagel in his hunt for a target may be the more prudent choice.

Capital Calls: Uber’s cash starts to flow

2 Aug 2022

Concise views on global finance: The $56 billion car-hailing service is growing rapidly and has started generating positive cash flow. It’s still overvalued, though.

UK car insurer pile-up may lure M&A rubberneckers

28 Jul 2022

Direct Line and rivals’ shares have crashed due to inflation and the soaring cost of claims. Yet waning competition may boost future returns. It’s a good time for a potential acquirer, say France’s Cóvea, to step in, especially with private equity on the sidelines.

Santos throws down M&A cost-cutting gauntlet

22 Jul 2022

The $17 bln fossil-gas giant took just six months to deliver promised savings from acquiring Oil Search. That handily beats the 18-month timeframe advocated by McKinsey, and embarrasses ANZ’s six-year timetable for its Suncorp deal. CEO Kevin Gallagher has raised the synergy bar.

Insurers can boost carbon credits, and themselves

19 Jul 2022

The market for planting trees to offset carbon could be worth $50 bln by 2030. But the unregulated space means large corporate buyers could face heavy losses and even fraud. Insurance could help tame the market, and give companies like Allianz and Zurich a sales boost.

Capital Calls: Fed faces inflation divergence

30 Jun 2022

Concise views on global finance: The central bank’s preferred measure of rising prices, the U.S. personal consumption index, rose 6.3% in May. That’s more subdued than the surging consumer price index. But the latter offers a better read on household spending.

Cost of Asia’s recurring floods will trickle down

24 Jun 2022

Swathes of Bangladesh and India’s Assam state were swamped this week, affecting 9 mln people. Insurers shy away from offering cover for such disasters if they’re too frequent. For countries on the front lines as climate change worsens, the burden on the public purse will rise.

Fourth time to be the charm for Richard Li’s IPO

1 Jun 2022

Poor markets have derailed insurer FWD’s $1 bln float. That’s the third delay after a costly Hong Kong to New York round trip, and a flirt with super voting stock. The pause gives the tycoon time to improve the Asian-focused company’s profit record and to freshen its pitch.

Capital Calls: Airbnb, Prudential, Glencore

25 May 2022

Concise views on global finance: The $68 bln vacation-booking platform will shut its Chinese business; the insurer appoints a new CEO – finally; the commodities giant has a $10 bln reason to keep its nose clean, after a $1.5 bln settlement for corruption allegations.

BoE pours cold water on bank global-warming panic

24 May 2022

The watchdog’s stress test showed UK lenders can weather a chaotic climate switch without a capital hit. For bank CEOs copping flak for funding polluters, it’s a let-off. The other lesson is that governments will get little help from financial regulators in greening the economy.

Capital Calls: Turkey, Nintendo/Sony, India IPO

10 May 2022

Concise views on global finance: President Erdogan makes another ham-fisted monetary intervention; the Switch maker weathers supply chain ructions better than its larger rival; New Delhi needs to be even more generous in its landmark listing of Life Insurance Corp of India.

HSBC breakup, Big Oil’s surprise restraint

5 May 2022

The $129 bln bank is under pressure from its largest shareholder to spin off its Asian unit. In this Viewsroom podcast, Breakingviews columnists discuss why the plan deserves short shrift. Also, the decision by oil giants to limit production will win few friends.

Italy’s financial order repels attack on Generali

29 Apr 2022

Mediobanca-backed CEO Philippe Donnet overcame opposition from investors with 30% of the $30 bln insurer to win a third term. That preserves a key financial link with the merchant bank. Donnet now has to deliver on his growth plan. The rebel investors will keep him on his toes.

Capital Calls: U.S. GDP fall masks solid economy

28 Apr 2022

Concise views on global finance: Consumer spending and business investment are resilient amid price hikes.

SocGen avoids the worst in costly Russian exit

11 Apr 2022

The French bank is selling Rosbank back to the oligarch it bought the unit from 16 years ago. Despite a 3 bln euro writeoff, the hit to its capital ratio is less than half the worst-case scenario it outlined last month. It’s a fitting end to a long and unhappy Russian story.

Generali investors better off with devil they know

30 Mar 2022

A rebel billionaire is vying for control of the 190-year-old insurer, a linchpin of Italian finance. Francesco Caltagirone promises higher returns and bolder M&A than under CEO Philippe Donnet. Fuzzy targets and slowing growth should make shareholders wary of switching horses.

UnitedHealth plays long game with M&A strategy

29 Mar 2022

A month after watchdogs sued to block a deal by the insurer, it agreed to buy home healthcare firm LHC for $5.4 bln. Both deals may mean UnitedHealth is bogged down in a delayed deal process. But adding LHC to UnitedHealth’s doctors, clinics and other units is worth the hassle.

AIG life IPO marks 5,000 days of post-crisis slog

29 Mar 2022

That’s how long it took to fix the global insurer after its 2008 bailout. It has now reached a point where, with a little help from Blackstone and even BlackRock, it can float its life and retirement business, probably worth at least $22 bln. It’s a key moment in AIG’s reboot.

Buffett does $11.6 bln mini-me deal because he can

21 Mar 2022

Insurance firm Alleghany is built in Berkshire’s likeness, with cultural similarities and a focus on growing book value. The difference: Alleghany is cheaper, even with a 25% premium. Closeness to the Omaha Sage may have clinched the deal; it also may explain the ho-hum price.

Climate change hands states an insurance dilemma

1 Mar 2022

Severe weather caused $343 bln worth of damage last year, and prompted insurers to either drive up premiums or cease home coverage altogether. States can avoid creating insurance black spots by taking over from the likes of Zurich. The catch is they may not be very good at it.