Aon Benfield Analytics | Market Analysis 1 MarketReView Newsletter Welcome to the latest edition of Aon Benfield’s monthly MarketReView newsletter! 2014 full-year reporting season is now complete; earnings releases have been distributed and published on MarketReView. The latest edition of our Aon Benfield Aggregate (ABA) report, assessing the financial performance of 31 of the world’s leading reinsurers in 2014, was launched on Monday. Read the report: http://bit.ly/1Dejfe2 Watch the film: http://bit.ly/1G8GjeK Access a replay of the webinar here Market Commentary M&A Activity Continues Sector consolidation remains the topic of the moment. Endurance has just announced an agreed offer to acquire Montpelier Re, the fifth significant transaction in the specialty (re)insurance markets in the last four months. RenRe’s acquisition of Platinum has already completed (March 2) and colleagues in the US have since published a Market Analysis Update summarizing the transaction, which can be found under Latest Research on MarketReView. Other corporate activity includes Sompo Japan’s acquisition of a 7.8% stake in SCOR, with the intention of increasing this to 15% in due course, and the official announcement of a cooperation agreement between Beazley and Korean Re. Further details can be found under Latest Market News. Aon Benfield South Africa Client Day While most of the London Market Analysis team was busy compiling the ABA report this month, Eleanore Obst, one of our London analysts embarked on a market visit of South Africa and spoke at the biennial Aon Benfield Client Day in Johannesburg on the topic of harnessing and digesting Big Data in the reinsurance industry. Issue #3 – March 2015
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Aon Benfield Analytics | Market Analysis
1
MarketReView Newsletter Welcome to the latest edition of Aon Benfield’s monthly MarketReView newsletter!
2014 full-year reporting season is now complete; earnings releases have been distributed and published on MarketReView.
The latest edition of our Aon Benfield Aggregate (ABA) report, assessing the financial performance of 31 of the world’s leading reinsurers in 2014, was launched on Monday.
Read the report: http://bit.ly/1Dejfe2
Watch the film: http://bit.ly/1G8GjeK
Access a replay of the webinar here
Market Commentary M&A Activity Continues
Sector consolidation remains the topic of the moment. Endurance has just announced an agreed offer to acquire Montpelier Re, the fifth significant transaction in the specialty (re)insurance markets in the last four months. RenRe’s acquisition of Platinum has already completed (March 2) and colleagues in the US have since published a Market Analysis Update summarizing the transaction, which can be found under Latest Research on MarketReView.
Other corporate activity includes Sompo Japan’s acquisition of a 7.8% stake in SCOR, with the intention of increasing this to 15% in due course, and the official announcement of a cooperation agreement between Beazley and Korean Re. Further details can be found under Latest Market News.
Aon Benfield South Africa Client Day While most of the London Market Analysis team was busy compiling the ABA report this month, Eleanore Obst, one of our London analysts embarked on a market visit of South Africa and spoke at the biennial Aon Benfield Client Day in Johannesburg on the topic of harnessing and digesting Big Data in the reinsurance industry.
Latest Research The following Market Analysis research was added to MarketReView during March 2015:
The Aon Benfield Aggregate – FY 2014 Market Analysis Update: RenRe Acquisition of
Platinum
Latest Market News The following press releases were posted to MarketReView during March 2015:
M&A Activity
Beazley and Korean Re Enter Into a Cooperation Agreement On March 30, 2015 Beazley and Korean Re confirmed earlier press reports, announcing the establishment of a strategic partnership. A new Lloyd’s Special Purpose Syndicate 6050 will be backed by Korean Re to write a whole account quota share of Beazley Syndicates 0623 and 2623 and Beazley will take a quota share of Korean Re’s commercial lines book. The transactions will equate to a reinsurance swap of approximately USD20 million between the parties.
Endurance Specialty Holdings to Acquire Montpelier Re Holdings On March 31, 2015, Endurance and Montpelier announced a definitive merger agreement under which Endurance will acquire Montpelier in a deal valued at USD1.83 billion, in a mixture of cash (24.6%) and newly issued Endurance shares. Endurance expects the acquisition will provide a complementary book of business, increase its scale and market presence, as well as providing third party capital management expertise and a scalable Lloyd’s platform. The current Endurance management will remain in place. The transaction is subject to regulatory and shareholder approvals and is expected to close in the third quarter of 2015.
RenRe Completes Acquisition of Platinum Underwriters On March 2, 2015, RenRe completed its previously announced acquisition of Platinum. Please refer to the Market Analysis Update under Latest Research on MarketReView, for the full details of the transaction.
Sompo Japan Nipponkoa to acquire 7.8% participation in SCOR SE Sompo Japan Nipponkoa Holdings, Inc. has reached an agreement to acquire a 7.8% stake in SCOR SE from the latter’s largest shareholder, Patinex AG, and plans to increase its holding to 15% or more over time.
Earnings
FY 2014 results Amlin, Hiscox, Berkshire, Novae, Scor, Hannover Re, Munich Re and Lloyd’s released their results during March, completing our reinsurance market earnings coverage for the full year. All earnings releases have been published on MarketReView.
Ratings
A.M. Best Comments on Ratings of Endurance and Montpelier Re Following the announced deal between Endurance and Montpelier, A.M. Best commented that its financial strength ratings of both groups remain unchanged.
S&P affirms Endurance and Montpelier Re; Revises Montpelier Re Outlook to Positive Following the announced deal between Endurance and Montpelier, S&P affirmed its ratings of Endurance with stable outlook, and revised its outlook on Montpelier from stable to positive, whilst affirming all ratings.
S&P upgrades International General Insurance Co. Ltd to 'A-'; outlook stable On March 31, 2015, S&P upgraded its ratings of IGI Bermuda and subsidiaries to ‘A-’ from ‘BBB+’, after they performed ahead of expectations in 2014.
S&P affirms AXIS and PartnerRe ratings; outlook stable On March 13, 2015, S&P removed the ratings of AXIS and PartnerRe from CreditWatch Negative and affirmed all the ratings with stable outlooks.
Market Profiles The following profiles were updated by the Market Analysis team during March 2015 and are attached to the respective company/syndicate records:
Groups:
Allied World Assurance Co Holdings AG Argo Group International Holdings Ltd Endurance Specialty Holdings Ltd Greenlight Capital Re Ltd Lancashire Holdings Ltd Maiden Holdings Ltd Validus Holdings Ltd White Mountains Insurance Group Ltd
Aon Benfield Analytics | Market Analysis
MarketReView Newsletter – March 2015 3
Rating Actions Companies followed on MarketReView that were affected by rating actions from A.M. Best and/or Standard & Poor’s during March 2015:
S&P Company Rating Action
Axis A+ / Stable Removed from CreditWatch Negative
Montpelier Re A- / Positive Outlook revised from Stable
PartnerRe A+ / Stable Removed from CreditWatch Negative
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