Japanese insurer Dai-ichi Life Co is in advanced talks to purchase U.S. peer Protective Life Corp in a deal that could be worth over $5 billion, extending a drive to buy assets abroad as an antidote to a weak domestic outlook.The deal would be the biggest so far in a string of overseas acquisitions by Japan's insurers. They're snapping up businesses in markets from the United States to Southeast Asia as a path to future growth while the rapid ageing and eventual shrinkage of Japan's population clouds long-term earnings prospects at home.Dai-ichi Life, Japan's second-largest private-sector life insurer, plans to buy 100 percent of Protective Life, said a source with direct knowledge of the matter. The 107-year-old U.S. company, based in Birmingham, Alabama, has a market capitalisation of $4 billion and posted a net profit of $393.5 million in 2013 from operations that span the country."For top (Japanese) insurers with large market share like Dai-ichi Life, it would be very difficult to secure growth when the overall domestic life insurance market starts shrinking," said Teruki Morinaga, insurance sector analyst at Fitch Ratings in Tokyo. "So, it has to go overseas," he said, adding he was commenting based on media reports and hadn't independently verified their accuracy.
Protective Life Corporation is a holding company. Shares of PL traded higher by 0.35% or $0.18/share to $52.30. In the past year, the shares have traded as low as $36.36 and as high as $54.48. On average, 364591 shares of PL exchange hands on a given day and today's volume is recorded at 338930.
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