UK and Ireland leads way on European M&A deals in H1 2023 as brokers attract investors

The UK and Ireland led the way in Europe for the number of merger and acquisition (M&A) deals completed during H1 2023, new figures have revealed.

According to FTI Consulting’s latest European Insurance M&A Barometer, some 112 transactions were made during the first half of 2023, up from 105 during the same period last year.

However, the report, which was published yesterday (5 October 2023), warned that deal activity may have now peaked across the British Isles.

The consultancy warned earlier this year (23 March 2023) that activity could peak during the year after revealing that deals fell from 197 in 2021 to 177 in 2022.

“The UK and Ireland, including Bermuda, continue to lead the European market for insurance industry M&A,” the FTI said in its latest report.

“Most of these were broker consolidation deals. It is thought, however, that deal activity in the region may have peaked due to the scarcity of broker targets.”

Across Europe

Across Europe, however, FTI said that the first half of 2023 was a ”highly active period for insurance M&A”.

For example, it said that broking attracted a variety of investors and accounted for 86% of Europe’s deal volume in H1 2023 – some 229 announced transactions were made compared to 186 in H1 2022.

H1 2023 also saw an increase of 35% in private equity activity in the distribution sector – direct and through portfolio companies.

And deal volumes for property and casualty carriers almost doubled, with 20 announced transactions compared to 13 in H1 2022.

FTI also revealed that while most deals were recorded in the UK and Ireland, Iberia was the most active market in continental Europe, compared to being third most active in 2022.

“The first half of 2023 was a highly active period for insurance M&A across Europe,” FTI said.

“This was despite uncertainty on macroeconomic conditions, significantly higher borrowing costs for distribution consolidators and what many of us thought was already an overheated level of activity.

“There are no signs that activity will decrease for the remainder of the year, but some restraint may start to emerge as the longer-term impact of macroeconomic conditions becomes more certain.”