BMS Group publishes report on private equity, mergers and acquisitions and taxation

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Reinsurance broker BMS Group has launched its first report on Private Equity, Mergers and Acquisitions and Taxation, which provides a holistic perspective on how M&A insurance interacts with the broader sphere of mergers and acquisitions around the world.

The report also gives a first look at behaviors and trends after the onset of the coronavirus pandemic, which saw a huge increase in activity from Q4 2020 to Q1 2021.

In the fourth quarter of 2020, BMS saw a 25% increase in transactions using M&A insurance compared to the same period in 2019 and the first quarter of 2021 saw a 21% increase in transactions using M&A insurance compared to the same period.

The report showed that while pricing remains the most important factor, nearly 40% of respondents were more concerned about the extent and extent of coverage.

While financial statements are the issue of most concern to buyers, large contracts are also a major source of complaints.

RMS

The report also provides insight into who buys and who initiates M&A insurance coverage, and some of the broader dynamics at play when M&A insurance is used.

Tan Pawar, Managing Director and Head of Private Equity, Mergers & Acquisitions and Taxation for BMS in London, said: How M&A Insurance interacts with the broader realm of transactions across the globe.

“We believe this is critically important given the many changes in transaction volume and transaction processes that have occurred over the past year given the impact of the pandemic.

“While claims have increased over the past few years, prices have remained competitive and M&A insurance has become an integral part of the transaction process. M&A insurance is definitely coming of age. We believe that 80% of private equity deals in North America now use M&A insurance, while in Europe and the UK the proportion is now firmly around two out of three deals.

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