Tokio Marine will pursue overseas M&A, says acquisitive insurer's new CEO

TOKYO (Reuters) - The incoming CEO of Tokio Marine Holdings Inc 8766.T said on Monday the insurer will actively pursue mergers and acquisitions (M&A) opportunities overseas to further diversify its geographic footprint.

“Valuations of companies, or deal prices, have become expensive given excess of (global) money. But if there is a really good company and a good chance, we would like to try,” Satoru Komiya told a news conference.

Komiya, currently senior managing director, was named to become CEO of Japan’s largest property-and-casualty insurer, succeeding Tsuyoshi Nagano. The change will be effective after the company’s annual shareholder meeting in June.

Tokio Marine is the most aggressive and successful in overseas M&A among Japan’s insurers. Since Nagano took over the helm in 2013, it has made a string of deals, including buying U.S. specialty insurer HCC Insurance Holdings for $7.5 billion in 2015.

Tokio Marine and rival property-and-casualty insurers have been accelerating overseas expansion to diversify their risk exposure geographically, so that a natural disaster hitting a particular region could be offset by profits from other areas.

The need for the overseas buildup is felt keenly by the Japanese insurers in recent years as the archipelago has been hit by powerful typhoons and earthquake.

Last year, a powerful typhoon caused massive damages in western Japan in September. The property-and-casualty insurance industry body estimates total insurance payouts to be around 585 billion yen ($5.34 billion) for the typhoon, the biggest for wind and flood damages in Japan.

For the six months ended in September last year, Tokio Marine’s domestic property-casualty insurance business suffered losses after booking hefty natural disaster insurance payouts, while its overseas business made a steep profit increase.

It’s not just property-and-casualty insurers in Japan who are seeking growth overseas through M&A deals. Earlier on Monday, the president of Japan’s largest life insurer, Nippon Life Insurance Co [NPNLI.UL], said his company is actively seeking deals overseas, with a focus on the United States and Asia’s emerging economies.

Komiya, 58, joined Tokio Marine in 1983 after getting an engineering degree from University of Tokyo. He is currently co-head of Tokio Marine’s international business.

($1 = 109.6300 yen)

Reporting by Taiga Uranaka; Editing by Muralikumar Anantharaman