Life insurance oligopoly
The US's John Hancock Financial Services finalized its merger with Canadian Manulife Financial Corporation. The $10 billion deal includes John Hancock's Canadian subsidiary, Maritime Life. The new company, which retains the Manulife name, will be the #1 life insurance company in Canada, #2 life insurance company in North America (after AIG), and the #5 life insurer world-wide. It is also the largest deal ever between an American and a Canadian company.
Manulife is the holding company for Manufacturers Life Insurance Company. It has operations in Canada, the US, and in Japan. It had 2004 revenues of $14 billion. In 2003, it attempted an unsuccessful takeover of rival Canada Life. John Hancock had revenues of $10 billion in 2003. Aside from insurance, it specializes in asset management.
In the past few months, there have been three major mergers in the insurance industry, each in different sectors: health, life, and property casualty. The Anthem/Wellpoint merger in the health area; the Hancock/Manulife merger in life, and the Travelers Property/St. Paul's deal in the property/casualty area. The three deals totals over $43 billion.
The general consensus is that companies will consolidate further, as substantial growth will best come through mergers and acquisitions, and there is money out there to finance the buy-ups.
7:39:31 PM 
|
|
