Japan: Tokio Marine to buy US insurer Pure Group for about $3B

Tokio Marine Holdings will buy insurer Pure Group for about US$3.1 billion, it announced on Thursday, October 3, marking its fourth sizable acquisition in the United States in a little over a decade.

Japanese financial firms have been forced to look abroad for growth amid an ageing, shrinking population at home. Tokio Marine, the world’s fourth-largest property-and-casualty insurer by revenue, has pushed into both emerging markets and the United States. 

“The US market is huge and it is expected to grow steadily,” Tokio Marine Chief Executive Satoru Komiya told a news conference. “Also, the market is transparent.” 

But he acknowledged that the US$3.1 billion price, at 33-times Pure Group’s forecast profit for 2020, was “not cheap.” “We are paying for Pure’s big potential growth,” he said. 

The deal, to be financed through cash on hand and external funding, is expected to close during the first quarter of 2020 and Tokio Marine will keep Pure Group’s current management in place, Tokio Marine said in a statement.

Full Content: Financial Times

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