Japanese insurers announce tri-merger plans
Japan-based insurance firms Mitsui Sumitomo Insurance Group, Aioi Insurance Co. and Nissay Dowa General Insurance have announced plans to merge.
The merger – to be completed by April 2010 – will result in the biggest casualty insurance firm in Japan, with annual revenues of around 2.7 trillion yen ($30 billion, £22 billion).
The three companies – Japan’s second, fourth and sixth ranked insurance firms by premiums – are set to sign a memorandum of understanding that will set in motion formal negotiations for the merger.
Cost reduction is a key motive for the merger, with the firms planning to unify divisions handing computer systems and damage assessment.
Japan’s insurance market is currently ‘very severe’, according to Mitsui Sumitomo President Toshiaki Egashira.
This is partly due to a falling birth-rate and ageing population, and partly because people are driving less because of the global recession.
The improved efficiency created by merging will allow the companies to increase profit margins and explore overseas markets.
The merged company will be given a new and neutral name, according to Japanese news group Nikkei.
Category: Companies News, Insurance News
Visited 1155 times, 1 so far today
Comments (0)
Trackback URL | Comments RSS Feed
There are no comments yet. Why not be the first to speak your mind.