Seasoned executives in the international financial services industry have highlighted to International Investment what a significant deal the acquisition of Quilter International by Utmost Group is in recent history, while also voicing some concerns.
For Bryan Low, managing partner of Acuity Corporate Consulting it's "the biggest news in the cross-border life market in quite some time!".
"Utmost International has already built its new Utmost Wealth Solutions into a major writer of new business internationally after consolidating acquisitions of AXA and Generali companies in Ireland, the Isle of Man and Channel Islands.
"With the Quilter International business included Utmost International will become the largest offshore bond provider in the important UK market. Internationally, Quilter International's European business complements Utmost's profile there and its presence and licences in Asia and the Middle East will boost Utmost's business development opportunities."
Low added: "In some ways it's concerning to see more consolidation in a market with only a relatively small number of major providers already. However, this acquisition is a good fit for both entities and will create a strong player focused on markets and sectors that have strong growth prospects, so it should benefit both advisers and their clients."
Bob Pain, chief executive of AILO, also pointed to the history of the cross border international life and wealth management industry which he said has seen many mergers and acquisitions over recent years as many parent companies evaluate the strategic value of their international subsidiaries.
"The latest acquisition by Utmost of Quilter International should be seen as both a positive and exciting opportunity for all involved. Utmost has experience in M&A in our sector and has to date kept all its acquired businesses open to new business. This is important for distributors who are seeing their product options open to their clients shrinking as life companies withdraw from regions.
I wish both parties every success", said Pain.
While Graham Bentley, managing director of independent consultancy gbi2 and also an independent non-executive director of Marlborough International (Guernsey) and IFSL International, Marlborough's Dublin business, said: "I believe this is a really good deal for both businesses. It reinforces and dramatically extends Utmost's presence with advisers and customers, potentially to become the major international life assurance provider.
"It allows Quilter to consolidate its efforts to be the leading wealth management business in the UK."
Mark Polson, principal, the Lang Cat, said: "With this deal the pace of corporate activity in 2021 looks set to be even faster than we saw in 2020. There's a clear trend of larger providers really trying to concentrate on core areas of business and leaving other lines behind.
"We see it here with Quilter and Utmost, and also with the recent Standard Life / Phoenix deal. It's all part of a reshaping of the market which sees these types of firms moving away from trying to do everything for everyone all the time.
"For it to work well for advisers, of course, providers also have to work well together and invest in seamless integrations that can deliver better experiences for advisers and their clients", Polson said.
David White, managing director of Isle of Man-based QB Partners, also commented: "Utmost Group have obviously been very active in the consolidation space, but even so I think this latest acquisition will still have taken most industry commentators by surprise.
"Quilter International have been one of the major players in the international market for many years under various brands. Utmost purchased Generali Europe and Generali Worldwide recently and the addition of the Quilter book will increase the footprint in the Middle East and Asia markets which General Worldwide brought to the Group.
White added that Quilter also potentially offers alternative forms of distribution to the Utmost Group as it has purchased some IFA businesses in recent years.
"This latest acquisition reduces the number of major players in the international space further and investment platforms are growing and competing with the international life companies for IFA distribution.
"IFG Limited recognized this change at a fairly stage and purchased Ardan to diversify their offering and to be able to offer advisers and their clients a choice of platforms. This may be something with the Utmost Group might consider going forwards as up to now their acquisitions have focused primarily on international life assurers."
"Whilst the number of major players in the international insurance market has consolidated over recent years, the market does appear to remain attractive to new entrants and there are still a significant number of companies in the market", White said.
