AXA to Acquire XL Group: Creating the #1 Global P&C Commercial Lines Insurance Platform
"This transaction is a unique strategic opportunity for
"
"Today marks an unrivalled opportunity to accelerate our strategy with a new strength and dimension. With every confidence in how we have positioned
XL Group Overview
Founded in 1986,
Strategic Rationale
This acquisition is aligned with
The opportunity to acquire
The strong complementarities between
Governance
Upon completion of the transaction, the combined operations of
Completion
Completion of the transaction is subject to approval by
Financial details of the acquisition
Transaction terms:
* Total transaction value of
* P/E of 11x post synergies
* 10 percent return on investment
Financing and capital impacts:
* Financed by ca.
*
* Estimated debt gearing at ca. 32 percent, of which +3 points from the US IPO related debt issuance, at year end 2018 with a target to be reduced below 28 percent within two years
* Solvency II ratio estimated to be in the range of 190 percent - 200 percent year end 2018, acquisition impact to be mitigated by operating return and the planned US IPO
* Capital synergies of ca. 30 percent reduction of
Earnings, synergies and cash:
* Compensating the US IPO earnings impact as soon as 2018
* Substantial synergies of ca.
* Cash accretive with more than 80 percent remittance ratio from
Medium and long-term outlook following the transactions
* Reduces sensitivities to financial markets
* Lower beta and cost of equity
* Increases cash remittance potential
*
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