Conning Research: M&A Transactions up in 2006; Values Expected to Rise in 2007-2008

(Hartford, CT) March 19, 2007 — Insurance industry mergers and acquisitions transactions increased in 2006 to the highest level since 2001 and may foreshadow an acceleration of activity into 2007-2008, according to a new study by Conning Research and Consulting, Inc.

“Insurance industry mergers and acquisitions transactions in 2006 increased due to a significant increase in the distribution sector. This is the highest level of transactions since 2001, yet the total value of these transactions was $8 billion lower than 2005 levels.” said Clint Harris, senior analyst at Conning Research & Consulting, Inc. “The property-casualty sector led public offerings, including secondary offerings, with eight of the nine IPOs and nine of the fourteen secondary offerings.”

The Conning Research study, “Mergers & Acquisitions and Public Equity Offerings—2007 Edition” continues Conning’s annual review of insurance industry M&A and its effects on the industry.

“While transaction level increases in the insurance industry have kept pace with the broader marketplace over the past five years, the annual value of transactions has been very volatile,” said Stephan Christiansen, director of research at Conning Research & Consulting. “Despite this, we forecast an increase in acquisition transaction values in the next 12-18 months, due to the continuing increase in surplus in the industry, along with private equity’s increasing involvement in insurance. The ability of these firms to access large amounts of capital, and their ability to secure relatively inexpensive debt layers, means that they can be part of transactions exceeding $10 billion. Therefore, we expect more transactions valued between $1 billion and $5 billion, with perhaps a few $10 billion or higher. Of course long-term drivers of scalability of data and process and global trends in business continue.”

“Mergers & Acquisitions and Public Equity Offerings—2007 Edition” is available for purchase from Conning Research & Consulting, Inc., by calling (888) 707-1177 or by visiting the company’s web site at

About Conning Research & Consulting, Inc.

Conning Research & Consulting provides insurance industry analysis to insurers and industry stakeholders. The Conning name has represented excellence in independent insurance industry research for 50 years. As a result of its wealth of experience and intimate knowledge of the insurance industry, Conning understands industry challenges and opportunities and provides in-depth insights and analyses on a wide range of industry products and issues. Conning is headquartered in Hartford, CT.