New Mergers & Acquisitions Activity Report From Clyde & Co

The latest info from Clyde and Co for you;

Global carrier M&A slumped to a 16-year low in 2024 as insurers pressed the pause button on dealmaking amidst a wave uncertainty and volatility through the year, Clyde & Co’s annual insurance Growth Report reveals.

2024 saw just 204 transactions completed, down from 346 the previous year and the lowest figure since Clyde & Co’s Growth report was first published in 2009. Stubbornly high interest rates, geopolitical instability and increasing regulatory oversight of the sector, reduced carrier appetite to do deals.

While traditional dealmaking remained muted over 2024, the global MGA sector was the beneficiary, as carriers in the US, Europe and the Middle East increasingly deployed capital in the space.

Despite a weak 2024, dealmaking in 2025 is expected to rebound, led by the US where resurgent investor confidence, cheered by the new government’s appetite for deregulation and a lower cost of capital, is predicted to fuel activity both domestically and abroad.

Foreign interest in the US Excess & Surplus market is expected to grow, while US carriers, buoyed by a strong Dollar, are likely to be tempted past their shores in search of underpriced assets in Europe and beyond.

As the global insurance sector contends with both the opportunities and threats of new technologies such as AI, 2025 is likely to see an increase in dealmaking fuelled directly by technology considerations including cyber resilience.

An increasingly divergent global regulatory landscape is predicted to act as both a catalyst and inhibitor for M&A in 2025, while the seemingly unstoppable rise of MGAs will continue.

Regional consolidation, particularly in markets such as the Middle East, is expected to continue, while a softening global rate environment will drive specialty plays.

Eva-Maria Barbosa, Partner, Clyde & Co said, “With many of the challenges that characterised 2024 persisting, dealmaking will be tough in 2025 as businesses grapple with a plethora of evolving risks. This is fuelling the growth of MGAs globally as they offer an appealing avenue to establishing footholds in uncertain markets and industries. While we can expect this trend to continue, traditional dealmaking could be rekindled too, particularly in the US where a deregulated economy is likely to prompt new activity around the world.  The pipeline of deals already mooted in the first half of 2025 is very strong.”

Dealmaking in Europe was largely confined to regional consolidation, save for a number of high-profile cross border acquisitions including Sampo’s high profile takeover of TopDanmark. In Germany, M&A was focused on consolidation in the mutual market, while the trend to capital deployment in MGAs amongst the largest carriers continued apace. In the UK market, Aviva’s much heralded re-entry into the Lloyd’s market through its acquisition of Probitas, failed to ignite activity in London, as uncertainty weighed heavy on local players.