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Insurance acquisitions and acquisitions decrease during H2: PwC



Insurance sector M&A activity slowed in the second half of 2022 on the combined effects of rising borrowing costs, economic uncertainty and inflation, which are forecast to remain headwinds into 2023, according to a report Thursday from PriceWaterhouseCoopers LLP.

For the six-month period from mid-May 2022 to mid-November 2022, there were 205 announced transactions with a total value of $2 billion, compared to 343 announced transactions and $15.4 billion in transaction value announced in the previous six-month period from mid-November 2021 to mid-May 2022.

Broker transactions made up the bulk of the deal volume, with 189 of the 203 insurance deals announced related to brokers and the remaining 1

4 to insurers, according to the report.

The headwinds in the deal became more acute during the year, PwC said. “Towards the end of the year, we began to see a more pronounced impact from economic uncertainty, as deal activity slowed further, with only 29 deals announced from late September to mid-November.

Such pressure is predicted to continue over the next year even as private equity buyers retain their interest in the sector.

“We expect economic headwinds to continue through the first quarter of 2023 as companies evaluate the impact of inflation and interest rates on deal value. As has been the case historically, we expect demand from private equity buyers for resilient, EBITDA-generating deals, as an insurance brokerage, will remain strong.”

Buyers of companies with strong balance sheets may also be re-interested in the insurance market as valuations fall in the “cooling” economy, PwC said.


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