Tokyo: Nippon Life Insurance Co agreed to buy Resolution Life Group Holdings Ltd for about US$8.2bil, the biggest takeover by a Japanese insurer as it seeks to grow beyond the domestic market.
Japanese life insurers are renewing their appetite for acquisitions at home and abroad after a lull following a string of multi-billion- US dollar deals a decade ago.
Nippon Life, the nation’s largest insurer by assets, is trying to diversify its profit drivers as the local market faces demographic challenges that are hindering growth prospects.
Nippon Life will buy the 77% of Resolution that it doesn’t own, the Japanese company said in a statement yesterday.
The deal will be funded by cash and is expected to be completed in the second half of 2025, pending regulatory approvals.
It will also purchase a 20% stake in its Australian unit MLC Ltd from National Australia Bank Ltd for about A$500mil to make it a wholly owned subsidiary, which it plans to merge with its Resolution Australasian arm.
Formed in 2003 by chairman Clive Cowdery, Resolution Life acquires and manages portfolios of life insurance policies.
It invests the assets and makes payouts when there are claims or policies mature.
The Bermuda-based company has operations in markets including Britain, the United States, Australia and New Zealand.
Blackstone Inc is among shareholders selling stakes in Resolution Life, though they will continue their strategic partnership.
The alternative-asset manager has had a role investing the insurer’s assets in areas including private credit, real estate and asset-backed finance.
The deal comes on the heels of another large investment abroad by Nippon Life, which completed the acquisition of a 21% stake in Houston-based Corebridge Financial Inc for US$3.8bil from American International Group Inc this week.
Nippon Life has long been the subject of speculation as a buyer of multi-billion assets in the US, where rival Japanese insurers have already made big acquisitions.
Dai-ichi Life Holdings Inc struck a deal in 2014 to buy Protective Life Corp for more than US$5bil.
Sumitomo Life Insurance Co and Meiji Yasuda Life Insurance Co also acquired US insurers around that time.
Nippon Life president Hiroshi Shimizu has said the company is looking to make large investments in major markets like the United States.
The company reiterated yesterday that it has set aside two trillion yen or about US$13.2bil as a war chest during its current mid-term plan through 2026. — Bloomberg
