Dai-ichi Life Acquires 15% Stake in UK Insurer M&G

Japanese insurer Dai-ichi Life Holdings on Friday said that it will be acquiring a minor stake of 15% in British insurance firm M&G creating significant alignment to capture long-term value creation opportunities across an array of strategic initiatives.

Dai-ichi Life Holdings intends to acquire this stake via on-market purchases with no change to M&G’s issued share capital. Subject to certain conditions having been met, Dai-ichi Life will have the right to appoint a director to the Board of M&G plc for as long as it holds at least a 15% shareholding in M&G.

The deal, which makes Dai-ichi Life the biggest single shareholder in M&G’s biggest single shareholder, is expected to deliver at least $6 billion of new business for M&G of which at least $3 billion is intended to be in M&G’s market-leading high-alpha strategies across public and private markets.

Similarly, the partnership is expected to generate at least $2 billion in new business flows for Dai-ichi Life over five years, through a combination of balance sheet investments in, or distribution of, asset management products offered by Dai-ichi Life’s subsidiaries, and through Dai-ichi Life’s distribution of jointly developed products.

Dai-ichi Life will also consider distributing M&G products in Japan and Asia, as well as working together to develop new products, and the two companies will also consider collaboration in life insurance in Europe and Japan.

They will also pursue opportunities to co-invest in new asset management capabilities, in line with their respective asset allocation needs and the growth priorities. Consistent with M&G’s strategy to deliver asset management and international growth, the strategic partnership with Dai-ichi Life HD will accelerate M&G’s expansion in European private markets.

Expanding Global Footprint

Dai-ichi Life President and CEO Tetsuya Kikuta said that M&G is a highly regarded global player in the insurance and asset management industries, and his company was glad to collaborate and develop capabilities together in multiple areas, especially in Europe.

“We see our partnership with M&G acting as a spearhead to develop our presence across Europe and the UK, accelerating our strategy to become a global top-tier insurance group. M&G possesses not only a reputable and long-established life insurance business, but comprehensive asset management solutions in both public and private markets,” he explained.

“With this alliance, we are bringing together our respective capabilities to create a mutually beneficial partnership that will create value over the long-term,” Kikuta added.

M&G Group CEO Andrea Rossi said that the partnership with Dai-ichi Life and the associated 15% investment is recognition of M&G’s strengths and clear confidence in his company’s leadership, strategy and long-term prospects.

He also said that it brings together two highly complementary international businesses with shared growth ambitions which aim to deliver excellent client service and sustainable shareholder returns.

“It will enable us to further capitalise on the significant private market opportunities across Europe and enable even greater access to the Japanese and Asian market where we will benefit from Dai-ichi Life Holdings market-leading expertise,” Rossi added.