The deal had been mooted, but confirmation of AIG’s 100% takeover of the Little Island-headquartered company, which grew out of a management buyout of Quinn Insurance four years ago, was only made yesterday. The deal remains reliant on regulatory approval.
While a transaction figure has not been disclosed, it has been widely speculated that the deal is costing AIG around €80m.
It is believed that Donal Clancy, Laya’s managing director and largest individual stakeholder, who is remaining with the firm, will pocket around €8m as part of the deal (as he is believed to have around a 10% stake).
Since its rebranding, the company has been 70% owned by the Aventas Group (the entity in charge of the former Quinn Group assets) and 30% by management. Aventas will make around €56m from the transaction, with former management taking a combined €24m or so. The other Laya management shareholders are Dermot O’Connor, Mary Condon, and Brenda Ryan.
It has also been reported that Aventas will need to pay part of its payment from the sale to Bupa, the UK insurer which originally sold its Irish operations to Quinn Insurance.
According to Mr Clancy, AIG’s investment marks “a huge milestone” for Laya, and is “exceptionally positive news” for its nearly 500,000 members.
“AIG’s global scale and reach presents us with the opportunity to expand the Laya Healthcare offering in Ireland and across Europe, where AIG has significant plans for growth,” he said.
Swiss Re — via its Elips Insurance subsidiary — will continue to underwrite Laya’s health policies, with IptiQ Life underwriting its life insurance policies.
AIG’s move for Laya will broaden its health insurance business, which until now has largely been focused on the US and parts of Asia.
“The strength of the Laya Healthcare management team and how they have grown their market share, despite record declines in the health insurance market, highlights the potential for further growth,” said AIG’s global head of health, Jay Sheehy.