Blog: Five insurance narratives worth following for the rest of the year

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So far in 2014 we have seen a number of major developments and loose ends seemingly tied up.

At the start of the year Goldman Sachs completed its deal to buy a stake in Hastings, whilst private equity houses Anacap, Bowmark Capital and Montagu have all put an end to the speculation about the futures of Brightside, Iprism and Open GI respectively.

The AJ Gallagher acquisition machine has also had a busy 2014, although its deal appetite has slowed down of late; and there have been some high profile comings and goings.

With this in mind, Post casts its net over a number of market narratives that might be worth watching over the rest of the year:

1) What next for Aspen and Endurance?

At the start of the year there were predictions that 2014 might be a bumper year for M&A activity. And whilst there has been some, it has not been at the expected levels. One deal that was talked about a lot but that came to nothing was Endurance's ill-fated hostile takeover of Aspen, which was called off just over a month ago.

Endurance Chairman John Charman said Aspen's focus on defensive self-preservation tactics rather than value creation made the offer impractical, whilst Aspen argued the prospective acquirer offered little and  that a combined business would not benefit clients.

As with all high profile takeover attempts - especially hostile ones - it will be interesting to see what both the pursuer and pursued do now the deal is of the table, especially given one of the two is obviously keen to grow through acquisition.

2) Co-operative Insurance back on the market?

Talking about deals that did not happen in 2014 - or deals that have not happened yet - the Co-operative insurance business was linked with a host of businesses including Legal & General; Advent International/Andy Haste; Catalina Holdings, Anacap and LV.

However, the bank decided to pull the sale in January with speculation rife that it could not get the price it wanted for the business.

As we have learned with Direct Line, this does not necessarily mean an end to the saga, and it would be no surprise if a sale mandate was being prepared again - if it is not already in circulation.

3) A-Plan stake for sale

One of the more successful insurance private equity stories of recent years is that of A-Plan and Equistone, with Equistone taking a stake in the high street broker in 2008.

Six years down the track, rumours had been mounting about whether the PE house would look to seek to realise its investment, and earlier this year it was confirmed that Equistone had appointed Evercore Partners to find a buyer for the firm, with A-Plan now valued at around £300m.

A-Plan's boss Carl Shuker has stressed there is no time frame or urgent need for a deal to be done, but this could reach a happy conclusion for all before the tinsel comes down at Christmas.

4) Will there be a big bang announcement from RSA?

Without question, RSA pulled a surprising coup when it unveiled Stephen Hester as its nes group CEO. Since joining the firm in February Hester has focused a lot of attention on disposals, with sales already notched in Poland, Canada, Hong Kong and Singapore, with more predicted.

In the UK there have been some notable exits at the business, none more high profile than Adrian Brown, who amicably crossed the path to join the AJ Gallagher revolution. But this was not the high profile restructure announcement that some had predicted.

However, that could change between now and 2015 though, with September mooted as the month we might hear more about what Hester has planned for the UK business, including its direct arm More Than.

Or will he wait until Brown's replacement as the domestic boss - Steve Lewis - takes up the reins?

5) Who will take over at Zurich?

Which leads us nicely to Lewis' former employer Zurich.

There was a lot of speculation about Brown's replacement in the months leading up to the appointment, and Lewis was not among the names most frequently mentioned - so his departure probably caught Zurich on the hop.

The well-respected commercial boss David Smith took up an "acting role", but with his retirement imminent the spotlight now turns to who will take up the UK CEO role permanently.

Given that Zurich tends to promote from within, there has been less gossip associated with this appointment that at RSA.

Indeed, there is a lot of talk that Lewis's role prior to being the UK CEO - as head of group operations, planning and performance management based in Zurich - might offer a clue as to his successor.

Or will Zurich surprise and go leftfield?

 

These are just five stories that Post will no doubt be following with interest over the coming months, but it is not a definitive list.

If you have any other suggestions, then please use the comment box to join the conversation.

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