QBE Seeks Further Acquisition Opportunities

Post by NeilMc on October 7, 2009 · Under Mergers & Acquistions, insurance · Comment

Australian insurance major QBE Insurance, foresees further acquisition opportunities emerging as the insurer looks to put its healthy balance sheet to work.

QBE’s chief financial officer Neil Drabsch, speaking at an investor conference in New York said that the insurer remained cautious amidst and uncertain economic climate. Mr. Drabsch added that the company’s healthy balance sheet and excess capital, would mean that the insurer would be seeking growth mainly through acquisition.

QBE’s M&A strategy has revolved around bolting on portfolio’s and underwriters to achieve growth in its existing businesses.

The company prefers acquiring businesses which will add to earnings within the first year of acquisition.

In August the insurer announced a 19 per cent increase in interim profit, reporting profits of $1.02 billion. The company aims to beat its 2008 annual profit of $1.86bn.

QBE chief Frank O’Halloran, during the earnings announcement said that whilst he was unable to comment of specific acquisition targets, he planned to increase the number of deals the company was considering before the year end.

QBE was looking at acquisition targets across Europe, Asia and Latin America that would add over $1 billion to its premium income.

QBE has made about 120 acquisitions since 1984 and has about $3bn in surplus capital.

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