Arch would take more M&A deals in earnings diversification drive

Global re/insurance group Arch Capital has a running wish list of assets and product lines it would ready to blow money on as it continues its drive for earnings stability through diversification, CEO Marc Grandisson has said. 

“We have a long list of things we'd like to acquire or have as part of our arsenal,” CEO Marc Grandisson told his company's Q1 earnings call. 

“We have a wish list of things we know for a fact would be accretive and additive to the diversification of our portfolio and we are always on the lookout for those,” he said. 

Targets need not be fully-fledged companies on the auction block, as was the recent case with Allianz mid-market assets in the US, but can be production teams along new business lines as well, he indicated. 

The pending purchase of the US mid-market and entertainment insurance businesses of Allianz's corporate and specialty unit AGCS fits the Arch goal of working towards “stable returns over the cycle,” Grandisson said. 

“We like having many ponds to fish in and this acquisition will significantly expand our opportunities in the middle market for years to come,” Grandisson said. 

The businesses being acquired are written by Fireman’s Fund Insurance Company and its subsidiaries and collectively totalled $1.7 billion of gross premium written in 2023. Approximately 500 employees from Allianz are expected to transfer to Arch as part of the agreement.

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