Axa in talks with US insurer XL over £60bn deal

A picture taken on January 19, 2011 in P
Axa logo in Paris (Source: Getty)

Insurer Axa is in advanced talks to acquire rival XL Group, according to reports.

According to Bloomberg a deal between the two insurers could be announced this week.

Bermuda-headquartered XL's share value has increased by 23 per cent this year giving it a valuation of $11bn (£8bn).

XL has also reportedly received interest from German insurance giant Allianz.

Meanwhile French-headquartered Axa has a market valuation of €61bn (£54.4bn) meaning a deal between the two could create a £60bn insurance player.

Read more: Axa to float stake in US operations in 2018

In February Axa published its full year results for 2017 revealing a two per cent slump in revenue to €98.5bn while profit grew 6.5 per cent to just over €6bn.

Axa chief executive Thomas Buberl announced last year that it plans to float a minority stake in its US business in the first half of 2018.

Buberl said: “We believe the current environment is supportive of this strategic initiative which would create significant additional financial flexibility to accelerate the transformation of the Axa Group around health, capital-light savings, protection and property and casualty commercial lines, our priority lines of business.”

In its 2017 results XL announced revenue of $11.3bn and a net loss attributable to shareholders of $560m.

XL said its results had been impacted by natural disasters, but its chief executive Mike McGavick said that he was “positive about where we are going” citing its “solid capital position” and “the strength of our market relevance.”

McGavick oversaw XL's 2015 acquisition of Lloyd's of London insurer Catlin in a £2.7bn deal.

Recent M&A deals in the insurance sector include US insurer AIG's acquisition of Lloyd's of London insurer Validus for $5.56bn.

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