In a possible tie-up that some Wall Street analysts, in keeping with the WSJ, name “a good deal” for MetLife shareholders, Zurich Insurance Group has confirmed that it’s in advanced negations via its Farmers Group to accumulate MetLife’s auto and residential insurance coverage unit. A Reuters report suggests the deal might fetch round US$4 billion (round £3 billion).
While MetLife has been increasing its advantages applications, having not too long ago agreed to purchase imaginative and prescient insurer Versant Health for US$1.7 billion, its P&C division has suffered robust competitors from rivals like GEICO, Progressive and State Farm.
The deal comes after a poor third quarter for MetLife’s P&C division – adjusted earnings at its US property and casualty arm slumped 68% to simply US$18 million on US$3.7 billion of premiums, 66% of which was from auto protection, with the remaining third being dwelling insurance coverage. The poor outcomes adopted the corporate’s greatest pure disaster losses in a decade, which overwhelmed the advance in auto claims throughout the COVID pandemic.
Although the insurer’s share worth has almost doubled from its March US$23 low, it’s nonetheless languishing beneath the US$52 it reached in late February.
Farmers Insurance Group ranked ninth in the US for P&C premiums final yr, accounting for just below 3% of the market.
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Top 10 Property & Casualty Insurers by premiums written
Sources near the negotiations have indicated that the plan is to announce the deal’s phrases subsequent month, so long as no unexpected glitches come up.