Page 11 - Demo

I. Review of M&A Activity in 2015
Political factors may well also affect European M&A in general, such as continuing economic uncertainty in several Eurozone economies and the prospect of a referendum on whether the U.K. should remain a member of the European Union (what is being dubbed the potential “Brexit”). At the time of this writing, it is anticipated that the U.K. referendum could take place as early as June 2016, with the possibility of consequential uncertainty in the markets until the result is known.
Finally, underlying market conditions, including low growth in mature markets, abundant capital and inexpensive financing, remain geared towards an active M&A market. The prevailing soft market environment across
the insurance industry could continue to spur M&A transactions. The lower returns for insurers and reinsurers and their ability to deploy surplus capital could make synergies that may be achieved by M&A attractive to particular insurance groups. Other European insurance groups may continue to hold their fire and manage their core businesses until the cycle turns toward a harder market.
Many of the drivers identified will be worth revisiting during the course of the year, particularly in the light of developments relating to the stability of the Eurozone, the possibility of the U.K. exiting the European Union andanyinterveningfactorsimpactingthesoftmarketor availability of capital.
10
Developments and Trends in Insurance Transactions and Regulation 2015 Year in Review