SoftBank closing on Swiss Re, Chaucer & Aspen on the block
It’s M&A season in insurance and reinsurance with seemingly nobody being safe from the searching eyes of an investor or acquirer and things are moving apace, with a number of deals on the table and likely more discussions going on behind closed doors.
The rumour mill has been rife with discussions about who will be next, after insurance giant AIG seemingly kicked off this current spell of activity with its acquisition of Bermudian insurance, reinsurance and third-party capital management group Validus.
That was quickly followed by rumours including whether XL Group could be a target, which was more recently confirmed to be true with the announcement that French insurance giant AXA would be buying XL, another Bermudian insurance, reinsurance and third-party capital management group.
Going on in the background of all of this was the news that reinsurance giant Swiss Re was having early stage talks with Japanese tech giant SoftBank Group about an investment in the reinsurer.
That deal has really set the imagination alight and got the rumour mill churning, as it clearly shows that no matter how big you are in reinsurance right now, you could always be bigger and a potentially transformative deal is attractive to everyone, especially if it can secure them a position outside of the M&A limelight.
According to the latest news on SoftBank and Swiss Re, the discussions are now making progress and the tech firm, headed by Masayoshi Son, is said to be offering between 100 and 105 francs per share for a stake in Swiss Re that could be as large as 25%.
At the upper end of that share price range it would value the reinsurance firm at roughly $39 billion, making the mooted SoftBank investment worth as much as $9.6 billion.
The price is approximately 16% above Swiss Re’s share price the day the initial rumours that SoftBank was interested emerged, so represent a decent increase in valuation for the reinsurance firm.
It’s said that these discussions have made progress and SoftBank is closing in, but at this stage no announcement has been forthcoming....MUCH MORE*March 28: "Re/Insurance: Axa May Have Made A Giant Mistake With Its Purchase of XL Group"